Retail inflation: CPI rises to 2.07% YoY in August; up from 1.61% in July

Retail inflation edged higher in August, with the Consumer Price Index (CPI) recording a year-on-year rise of 2.07%, up 46 basis points from July’s 1.61%, according to official data released by the Ministry of Statistics and Programme Implementation (MoSPI) on Friday.

The ministry said in its release that food inflation, based on the Consumer Food Price Index (CFPI), “remained in the negative territory at -0.69% (Provisional) in August 2025 as compared to August 2024.” This marked the third straight month of negative food inflation, although the rate improved by 107 basis points from July’s -1.76%.

The increase in both headline and food inflation during August was “mainly attributed to the rise in inflation of vegetables, meat and fish, oil and fats, personal care and effects, and eggs,” the statement noted.

Rural inflation stood at 1.69% in August, up from 1.18% in July, while urban inflation climbed to 2.47% from 2.10%. The CFPI-based food inflation was -0.70% in rural areas and -0.58% in urban centres.

Housing inflation moderated to 3.09% from 3.17% in July, while education inflation softened to 3.60% from 4.11%. Health inflation also eased marginally to 4.40% from 4.57%.

Transport and communication inflation slowed to 1.94% in August from 2.12% in July, while fuel and light inflation slipped to 2.43% from 2.67%.

The release noted that while headline inflation rose, it “remains well within the Reserve Bank of India’s target range.”