The Crossbill News Desk
India's retail inflation accelerated further in May, with consumer prices rising 3.93% year-on-year, according to data released by the Ministry of Statistics and Programme Implementation (MoSPI) on Friday (June 12).
The increase marked a rise from the 3.48% inflation recorded in April and extended the trend of monthly increases seen throughout 2026, as higher food costs and elevated input prices continued to feed into household expenses, The Indian Express reported.
The Consumer Food Price Index rose more sharply than overall inflation on a monthly basis, increasing 0.92% in May compared with a 0.75% rise in the headline Consumer Price Index (CPI). Economists expect inflationary pressures to persist, with forecasts suggesting that the headline figure could climb to around 4.5% in June.
“Geopolitical tensions and El Nino conditions continue to remain upside risks to inflation,” Megha Arora, Director at India Ratings & Research told the newspaper.
While crude oil prices have declined on reports of the US and Iran reaching an agreement over the opening of the Strait of Hormuz, “it will take time for crude prices to move towards $70/bbl”, a level seen before the West Asia war.
Rising costs have been particularly visible in the hospitality sector. Inflation in the ‘restaurant and accommodation services’ category climbed to 5.75% in May from 4.2% in April, after eateries passed on higher input costs to consumers following repeated increases in commercial LPG prices linked to the conflict in West Asia. Prices in the category rose 1.8% in May over the previous month.
Food inflation also picked up pace, reaching 4.78% in May compared to 4.2% in April. According to Radhika Rao, Senior Economist at DBS Bank, “heatwave conditions in some parts of the country” contributed to the rise in food prices.
With food costs remaining elevated and global uncertainties continuing to weigh on energy markets, analysts believe inflation risks remain tilted to the upside despite some easing in crude oil prices.
The increase marked a rise from the 3.48% inflation recorded in April and extended the trend of monthly increases seen throughout 2026, as higher food costs and elevated input prices continued to feed into household expenses, The Indian Express reported.
The Consumer Food Price Index rose more sharply than overall inflation on a monthly basis, increasing 0.92% in May compared with a 0.75% rise in the headline Consumer Price Index (CPI). Economists expect inflationary pressures to persist, with forecasts suggesting that the headline figure could climb to around 4.5% in June.
“Geopolitical tensions and El Nino conditions continue to remain upside risks to inflation,” Megha Arora, Director at India Ratings & Research told the newspaper.
While crude oil prices have declined on reports of the US and Iran reaching an agreement over the opening of the Strait of Hormuz, “it will take time for crude prices to move towards $70/bbl”, a level seen before the West Asia war.
Rising costs have been particularly visible in the hospitality sector. Inflation in the ‘restaurant and accommodation services’ category climbed to 5.75% in May from 4.2% in April, after eateries passed on higher input costs to consumers following repeated increases in commercial LPG prices linked to the conflict in West Asia. Prices in the category rose 1.8% in May over the previous month.
Food inflation also picked up pace, reaching 4.78% in May compared to 4.2% in April. According to Radhika Rao, Senior Economist at DBS Bank, “heatwave conditions in some parts of the country” contributed to the rise in food prices.
With food costs remaining elevated and global uncertainties continuing to weigh on energy markets, analysts believe inflation risks remain tilted to the upside despite some easing in crude oil prices.
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