New Delhi: A broad rise in food prices pushed retail inflation to 6.09% in October, from 5.54% in September, taking it past the Reserve Bank of India's upper tolerance limit.
The Ministry of Statistics and Programme Implementation released the data on Thursday. This is the first breach of the 2-6% band since the new 2024-base series began, and the highest reading since October 2024.
Food inflation climbed to 8.94% from 7.74% a month earlier. Onion prices rose 116.22% year on year. Garlic rose 60.74%, ginger 48.32% and lemon 47.30%. The RBI's assessment points to depleted stored onion stocks and uneven rainfall hitting the arrival of fresh kharif crops.
Rural inflation was 6.63% and urban 5.41%. Rural food inflation stood at 9.09% and urban food inflation at 8.68%.
The reading lands after the RBI raised the policy repo rate by 25 basis points to 5.50% in October and shifted its stance to calibrated tightening. The Monetary Policy Committee meets next on December 2-4.
Governor Sanjay Malhotra had said in October that inflation and its outlook were not benign, and that headline inflation was expected to average nearly 5.8% over the next three quarters. The central bank has raised its FY27 projection to 5.2%.
Inflation was highest in Andhra Pradesh, Telangana, Tamil Nadu, Madhya Pradesh, Puducherry, Dadra and Nagar Haveli and Daman and Diu, Uttar Pradesh and Odisha. It was lowest in Delhi, Mizoram, Tripura, Meghalaya, Lakshadweep, Arunachal Pradesh, Goa and Nagaland.
Silver jewellery and vegetables such as onion, ginger, garlic and lemon recorded the strongest price pressure. Potato, tomato, lady finger, coconut and motor cars were among items with the lowest all-India inflation.
Economists had expected the print to touch 6%. A Mint poll of 15 economists put the estimate at a two-year high of 6%, and Reuters reported that nearly half of those surveyed expected inflation to reach or exceed the threshold.
Relief may depend on winter vegetable arrivals. If food prices hold, households should brace for another round of pressure on loan instalments, with the December review the next checkpoint.