Retail inflation at 16-month high of 3.9% as food items get dearer

Retail inflation, measured by the Consumer Price Index (CPI), rose to a 16-month high of 3.9% in May 2026, primarily driven by increasing food prices, particularly tomatoes and cereals. Wholesale inflation also jumped to 8.3%. The article notes that retail inflation is nearing the Reserve Bank of India's (RBI) target of 4%. Core inflation also increased for the third consecutive month. Factors contributing to the rise include delayed monsoon, the El Nino effect, and higher fuel and logistics costs due to the West Asia conflict. Economists anticipate further increases and potential RBI rate hikes later in the year.