India: June CPI firms but internals benign: Inflation internals reinforce RBI hold in August

Research evidence excerpt

India: June CPI firms but internals benign: Inflation internals reinforce RBI hold in August

J P M O R G A N Asia Pacific Economic Research

14 July 2026

India: June CPI firms but internals

benign

Inflation internals reinforce RBI hold in August

Emerging Markets Asia, Economic

and Policy Research

Toshi Jain

(91-22) 6157-3387

toshi.jain@jpmorgan.com

JPMorgan Chase Bank, N.A., Mumbai Branch

Headline CPI surprised to the upside at 4.4%oya in June (J.P. Morgan and

Sajjid Z Chinoy

consensus: 4.2%), up from 4.0% in May. On a sequential basis, CPI increased 0.4%

(91-22) 6157-3386

m/m, sa in June (vs. 0.5% in May). The surprise was driven by spillover from May’s sajjid.z.chinoy@jpmorgan.com

fuel-price increase into June, as well as higher vegetable prices. With oil prices JPMorgan Chase Bank, N.A., Mumbai Branch

near $75-80/bbl, pump prices are unlikely to rise further, though uncertainty Anusha Mital

remains elevated given recent developments in the Middle East. (91-22) 6157-4113

anusha.mital@jpmchase.com

More importantly, beyond the headlines, the internals were benign. Core-core J.P. Morgan India Private Limited

inflation (core CPI excluding petrol/diesel and precious metals) rose 0.3% m/m

(sa) in June, easing from 0.4% in May. On a year-ago basis, this translated into

core-core inflation rising to still contained 2.5%oya in June from 2.3% in May. This

soft print suggests limited spillover from elevated oil prices into core prices. That

is not surprising, as the government absorbed a significant share of the oil-price

shock.

Food prices also remained benign, rising 0.3% m/m, sa in June. Food inflation

increased to 5.1%oya from 4.5% in May, driven by vegetables and meat. High-

frequency indicators for July point to further strength in vegetable prices; however,