India’s retail inflation eased to 5.3 per cent from 5.59 per cent in July.

This will be the second-consecutive month that the inflation will be between 4 and 6 per cent, which is the RBI’s tolerance band. Food prices fell by 3.11 per cent this month, causing the drop in inflation.

After the pandemic hit, the global economy is now reopening and demand is recovering. This has driven up commodity prices globally.

The governor of RBI Shaktikanta Das has said that the central bank will target inflation in 2-6% range and seek to gradually move towards achieving the 4 per cent target over a period of time,

Easing retail inflation will help the RBI to keep rates benign and focus on improving growth as the economy charts a much needed recovery from the pandemic lows.