New Delhi, September 14 (Daily Kiran) : Retail inflation in India has seen a notable increase, climbing to 4.82% in August from 4.5% in July, primarily due to rising food prices. Rajni Sinha, Chief Economist at Care Ratings, pointed out that the inflation outlook remains sensitive to weather-related risks and external factors.
Core inflation also rose to 4.4% in August, up from 4.2% in the previous month. However, excluding precious metals, core inflation remained relatively stable at 3.3%. The increase in the overall inflation rate has been attributed to higher prices for items such as sugar, rice, edible oils, and certain vegetables like onions.
According to data cited by the PHD Chamber of Commerce and Industry (PHDCCI), the Consumer Price Index (CPI) recorded an annual rise of 4.82% in August 2026. Food inflation increased from 5.52% in July to 5.66% in August, with rural areas experiencing food inflation at 6.13%.
Significant price hikes were noted in key food items, with ginger, onions, and garlic seeing increases of 73.82%, 48.27%, and 43.60%, respectively. Conversely, prices for tomatoes and potatoes decreased, with tomatoes dropping by 31.09% and potatoes by 13.14%.
Sinha explained that the delayed monsoon has affected the sowing of new onion crops, leading to a delay in market supply and putting upward pressure on prices. Additionally, lower sugarcane yields and a shift towards ethanol production have reduced domestic sugar availability, impacting prices.
The rise in food prices is also affecting the cost structures within the food and beverage industry. Rajeev Juneja, President of PHDCCI, noted that the sharp increases in essential food prices could heighten cost pressures on food processing industries, restaurants, and related services.
In August, inflation in personal care, social security, and miscellaneous goods and services remained high at 15.21%. This surge was primarily due to rising global prices of gold and silver, which drove up jewelry costs. Prices for silver jewelry increased by 107.11%, while gold, diamond, and platinum jewelry rose by 35.53%.
Ranjeet Mehta, Secretary General and CEO of PHDCCI, expressed concerns that persistently high prices of precious metals could impact demand during the upcoming festive and wedding seasons.
Care Ratings estimates that retail inflation could peak in the third quarter of the fiscal year 2026-27, averaging around 5% for the entire fiscal year. Regarding monetary policy, Sinha indicated that the Reserve Bank of India’s monetary policy committee will continue to make decisions based on evolving inflation and economic growth conditions.
She added, “If inflation continues to rise, the likelihood of interest rate hikes in the coming months may strengthen.” Attention will be particularly focused on the RBI’s monetary policy review in October, as many major central banks worldwide have already begun tightening their monetary policies.
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