Stubborn Food Prices Hamper Inflation Decline, Says RBI Governor

RBI Governor Shaktikanta Das attributes the slow decline in retail inflation to stubborn food prices. Despite a 4:2 MPC vote to maintain the repo rate at 6.25%, food inflation driven by supply-side shocks remains a crucial factor. A normal monsoon could potentially ease price pressures.

The relentless food prices are stalling the descent of overall retail inflation, noted Reserve Bank of India (RBI) Governor Shaktikanta Das during the recent Monetary Policy Committee (MPC) meeting, according to minutes released on Friday.

The MPC elected, by a 4:2 vote, to maintain the benchmark interest rate at 6.25% for the eighth consecutive time, aimed at steering the economic ship through turbulent waters.

Headline CPI inflation is decelerating, albeit slowly, with the last stretch of disinflation proving arduous. 'Food inflation, driven by recurrent supply-side shocks, remains the primary hurdle,' Das elaborated, suggesting that a normal monsoon might help alleviate some price pressures.

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