Jul retail inflation falls to 1.55%, lowest in 8 years

Drop is driven by food prices, which declined by 75 bps from June

- Dipak Mondal @ New Delhi

As predicted, the retail inflation in July fell sharply to 1.55%, down 55 basis points from June's 2.10%, lowest level since June 2017, according to data released by the National Statistics Office (NSO) on Tuesday. The monthly inflation number fell below 2% for the first time since January 2019.

The drop was driven by a steep fall in food prices. The Consumer Food Price Index (CFPI) saw a deflation of 1.76% YoY in July as against a 0.01% contraction in June. Rural food inflation stood at -1.74% while urban food prices fell by 1.90%. This is the lowest food inflation reading since January 2019.