Retail inflation crosses 4% in June after 16 months; food inflation at 5.32%

📌 Summary:

• CPI retail inflation rose to 4.38% in June 2026 (from 3.93% in May) — the highest in one-and-a-half years and above the RBI’s 4% medium-term target for the first time since Jan 2025 (new series)
• Data released by MoSPI; food inflation (CFPI) rose to 5.32% (from 4.78%) amid deficient rains; CFPI rose 1.7% month-on-month vs 1% for overall prices
• Fuel-price pass-through: personal transport inflation jumped to 7.35% (from 3.06%) after four retail fuel-price hikes from mid-May driven by the West Asia war and global energy prices
• Restaurant & accommodation services inflation rose to 6.9% (from 5.75% in May) on costlier commercial LPG; Bank of Baroda economist says it is unlikely to fall even as energy normalises
• CPI averaged 3.9% in April–June, below RBI’s 4.2% forecast; RBI’s legal mandate is 4% inflation within a 2–6% band
• New CPI series uses 2024 as base year (old series used 2012) with new methods and data sources — the two are not strictly comparable

🎯 UPSC Relevance: GS3 — inflation dynamics, monetary policy framework (flexible inflation targeting), impact of global oil shocks on domestic prices, food security.

📝 Prelims Facts:

• CPI (headline) June: 4.38%; food (CFPI): 5.32%; RBI target 4% (+/-2%)
• New CPI base year: 2024; data released by MoSPI
• Personal transport inflation: 7.35% in June

🔑 Key Term: Consumer Food Price Index (CFPI) — measures inflation in the food component of the CPI basket.