Retail inflation, as measured by the Consumer Price Index (CPI), accelerated to 5.76 per cent in May, its highest level in 21 months, driven primarily by rising food prices.
The index came in at 5.47 per cent in April 2016. It was 5 per cent in May last year. The last time the retail inflation was higher was in August 2014 when it crossed 7 per cent. “A jump in food inflation has led to the increase in overall print for inflation,” Richa Gupta, Senior Economist, Deloitte said. “Vegetable prices have moved up over the past one month and inflation (in vegetable prices) has now moved into double digit territory possibly reflecting the effect of the hot weather conditions. Shortage in the sugar market has also moved up prices and could move up further during the festival season.