Inflation

The sowing area for rice declined by 17.4 per cent. According to the report, the uptick in the rainfall has resulted in pick-up of kharif sowing which rose by 0.1 per cent. Out of 36 subdivisions, only 7 have received deficient rainfall during this period. "However, there has been uneven distribution of rainfall and there is growing concern that this might translate in to lower sowing, resulting in lower production.

On a monthly basis, the country's CPI rose by 0.8 per cent in June 2022, compared with a rise of 0.5 percent in June 2021, according to the Office for National Statistics (ONS). The increase in annual inflation was driven by rising fuel and food prices, and these were only slightly offset by falling second-hand car prices, said Grant Fitzner, ONS chief economist.

The onions were procured from the current rabi harvest for the price stabilisation buffer. The stocks have been procured by National Agricultural Cooperative Marketing Federation of India (NAFED) from farmers through the Farmer Producer Organisations (FPOs) in rabi onion growing states of Maharashtra, Gujarat and Madhya Pradesh.

Inflation as measured by producer wholesale prices ticked up to a red-hot 11.3 per cent for the year ending in June, near the highest record, according to a report from the Bureau of Labor Statistics. Thursday's report comes a day after headline inflation as measured by the consumer price index exploded to 9.1 per cent for the 12 months ending in June, the highest level since 1981 and a bigger increase than expected.

The high rate of inflation in June is primarily due to rise in prices of mineral oils, food articles, crude petroleum and natural gas, basic metals, chemicals and chemical products, food products, as compared to the corresponding month of the previous year. it said. The WPI Food Index, which has a weight of 24.38 per cent, and comprises 'Food Articles' from Primary Articles group and 'Food Products' from Manufactured Products group, has increased from 176.1 in May to 178.4 in June.

A combination of factors like the extreme weather, the Covid-19 pandemic and lockdowns in China, Russian invasion of Ukraine resulted in distorting global supply chain and inflation, Moody's Analytics said in a commentary.

The inflation rate rise was the largest 12-month increase since the period ending November 1981. The US Bureau of Labour Statistics said: "Over the last 12 months, the all items index increased 9.1 percent before seasonal adjustment." "The Consumer Price Index for All Urban Consumers (CPI-U) increased 1.3 per cent in June on a seasonally adjusted basis after rising 1.0 per cent in May," it said.

In a research report, the SBI also said the 7.01 per cent consumer price index (CPI) inflation announced by the Indian government on Tuesday for June 2022 confirms the fact that the peak point has passed. According to the SBI report, CPI inflation attributable to supply side factors started moving up after September'21 while demand led CPI remained more or less constant.

India's retail price inflation marginally eased and stood at 7.01 per cent at the end of June, as compared to that of May, the government said on Tuesday. As per the data released by the National Statistical Office (NSO) under the Ministry of Statistics and Programme Implementation, the retail price inflation at the end of June was 7.01 per cent (rural 7.09 per cent, urban 6.92 per cent), as compared to 7.04 per cent in May (rural 7.08 per cent, urban 7.08 per cent).

Nevertheless, there is considerable uncertainty in projecting trade and current account deficit due to high volatility in commodity prices, which in the current environment is taking cues from unpredictable geopolitical events. "Given, the relentless rise in commodity prices particularly crude oil which has again risen to $120 per barrel, we project current account deficit (CAD) to widen to more than $90 billion (in FY23) from an estimated $47 billion in FY22.