Food inflation likely to remain high in the near future

15-Sep-2026 01:47 PM

New Delhi: The food inflation rate based on the Consumer Price Index (CPI) rose to 5.95 percent in August 2026, primarily driven by price hikes in ginger, garlic, onions, sugar, and edible oils.

In August, the Consumer Food Price Index saw a rise of 0.92 percent compared to July. It is worth noting that the index had recorded an even sharper increase in July compared to June, reaching 5.52 percent. From June to December 2025, the food price index had remained in negative territory as the prices of many commodities had declined.

Significantly, when the Ministry of Statistics and Programme Implementation launched the new CPI series in January 2026—with 2024 as the base year—the food inflation rate was estimated at just 2.13 percent. The previous index had used 2012 as the base year. A comparison of these two base years reveals that the food price index in August 2026 reached its highest level in the last 19 months. This situation is a cause for concern for the Reserve Bank of India.

According to official data, prices in August 2026 were higher by 73.82 percent for ginger, 48.27 percent for onions, 43.60 percent for garlic, 24.2 percent for sugar, and 6.92 percent for mustard oil. Compared to August 2025, the retail price of edible oils rose by 8.8 percent in August 2026. The rate of increase in rice prices rose from 3.3 percent to 5.88 percent between July and August.

The period from September to November marks the festive season, during which the demand for various food products and spices increases. Market analysts believe that the food inflation graph could remain at a high level during this quarter.