Inflation rate slightly subdues in July; falls below 7 per cent but remains above RBI’s upper tolerance limit

New Delhi, August 12

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With global prices of crude oil, coal and fertilisers cooling off, inflation based on consumer price index (CPI) slipped below the seven per cent mark in the month of July but remained above the Reserve Bank of India’s upper band of six per cent.

The CPI-based inflation rate was 6.71 per cent in July as against 7.01 per cent in the previous month. Rural inflation at 6.80 per cent was higher than the urban inflation of 6.49 per cent, according to the National Statistical Office (NSO) data that is released by convention on the twelfth of every month.

The slightly lower inflation rate was also due to the slight softening of food prices which account for more than half the weight in the CPI. All India Consumer Price Indices with 2012 as 100 was at 174.9 in July as against 175 in June. The indices for transport and communication were also lower at 161.1 as against 161.6.

The Quick Estimates of Index of Industrial Production (IIP) with base 2011-12 for the month of June was at 137.9, according to another set of data released by the NSO.

The Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for June stood at 113.4, 136.3 and 196.9 respectively. As per the use-based classification, the indices stand at 139.2 for Primary Goods, 102.4 for Capital Goods, 147.3 for Intermediate Goods and 148.9 for Infrastructure/ Construction Goods. Further, the indices for Consumer durables and Consumer non-durables stand at 123.9 and 145.9 respectively for June.