After touching a 15-month high of 7.44 per cent in July 2023, retail inflation based on the Consumer Price Index (CPI) declined to 6.83 per cent in August 2023 mainly due to softening prices of vegetables. CPI was at 7 per cent in August 2022. But, still the inflation remains above the comfort level of the Reserve Bank of India (RBI), which has the mandate to ensure inflation remains at 4 per cent with a margin of 2 per cent on either side.

The overall inflation in the food basket stood at 9.94 per cent in August as against 11.51 per cent in July. The National Statistical Office (NSO) under Ministry of Statistics and Programme Implementation in its data has showed that Rural CPI (General) in August 2023 stood at 7.02 per cent as against 7.63 per cent in July. The Urban CPI (General) stood at 6.59 per cent in August as against 7.20 per cent in July. The index value for Rural, Urban and Combined CPI (General) stood at 187.6, 184.5 and 186.2 respectively, in August 2023.

Inflation in the vegetable basket eased to 26.14 per cent in August as against 37.4 per cent in July. The prices of 'oil and fats' products declined to 15.28 per cent in August while there was low inflation in 'meat and fish', 'eggs', 'sugar and confectionary', 'non-alcoholic beverages', 'fruits' and 'prepared meals and snacks' on an annual basis. The data also showed that inflation in the 'housing' was at 4.38 per cent and 'fuel and light' at 4.31 per cent.