Ghar Kharcha: Some Relief, Need For More

It's been a difficult two-and-a-half years for most of us. First the pandemic, then a rise in prices. At long last, retail inflation is showing signs of having peaked and continues to fall.

Consumer inflation eased for the third straight month in July to 6.71%, the lowest in five months.

Inflation in urban areas eased to 6.5%, while it fell to 6.8% in rural areas— the lowest in five months in both cases.

Over 45% of an Indian consumer's basket is made up of food. Little wonder that it sent alarm bells ringing when inflation in food and beverages rose to 8.1% in May, the highest since November 2020. Several food items, that had seen a sharp rise in prices, continued to show signs of correction in July, with food and beverage inflation at 6.7%.

Oils and fats inflation was at 7.52%, the lowest since January 2020.

Meat and fish inflation fell to 3%, the lowest since 2018.

Inflation in cereals remained a pain point, rising to 6.9%, the highest since 2014. Wheat, maida, noodles, bread and biscuits inflation is above 6%.

Fruits inflation also rose to 6.4%, the highest in nearly an year.

Transport and communication inflation eased to 5.5% in June—the lowest since March 2020. Prices of diesel and petrol for vehicles rose at the slowest pace since November 2019, and were lower than a month ago. However, prices of LPG and kerosene rose faster.

Inflation in clothing and footwear spiked to 9.91%—the highest since at least 2014. Clothing inflation rose to a record high of 9.5%, while footwear inflation was at 11.9%.