Primary food inflation fell 3.3 percentage points to 5.2 per cent due to a fall in the prices of vegetables, and egg, meat & fish.
Fuel inflation declined about three percentage points to 4.5 per cent, as petrol prices fell due to a decline in crude oil prices, while electricity prices rose marginally on the back of a high base.
By contrast, core inflation, an indicator of demand-side pressure on prices, fell, albeit marginally.
Non-food manufacturing inflation, the Reserve Bank of India’s measure of core inflation, fell to 3.5 per cent from 3.6 per cent in July.
The broad-based decline in core inflation seen last month wasn’t sustained in August.
In fact, inflation was seen rising in categories such as chemicals, non-metallic mineral products and machinery, though its impact was offset by lower inflation for basic metals and textiles, which together account for a third of core inflation.
For August, the CRISIL core inflation indicator, an alternative measure of core inflation (calculated by removing metal prices from the prices of manufactured articles), stood at 3.6 per cent, a tad higher than RBI’s measure.
The reason metals are excluded from the CCII is their prices are usually determined by changing global demand-supply dynamics and volatility
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