MUMBAI: Retail inflation or the Consumer Price Index-based inflation (CPI) for the month of May surged to 6.30 percent, much higher than April's 4.23 percent, which is over and above the Reserve Bank of India’s (RBI) threshold of 6 per cent.

This is the first time in six months that the CPI data has come over the RBI’s upper margin of 6 per cent. Prior to this, the CPI had been below the 6 per cent mark for five consecutive months. The government has asked the central bank to maintain retail inflation at 4 per cent with a margin of 2 per cent on either side for a five-year period ending March 2026.

The CPI data is mainly factored in by the RBI while making its bi-monthly monetary policy. Earlier this month, the Monetary Policy Committee (MPC) of the central bank had kept the Repo Rate unchanged for the sixth time in a row at 4 per cent, while maintaining an 'accommodative stance' as long as necessary to mitigate the impact of the second wave of the COVID-19 pandemic.

The RBI has projected the CPI inflation at 5.1 per cent during the ongoing financial year of 2021-22. It sees CPI inflation at 5.2 per cent in Q1, 5.4 per cent in Q2, 4.7 per cent in Q3, 5.3 per cent in Q4, with risks broadly balanced.

The Consumer Food Price Index or the inflation in the food basket also spiked in May to 5.01 per cent, from 1.96 per cent in April, the data revealed. The spike in the food basket was due to a sharp rise in prices of edible oil, which climbed by 30.84 per cent year-on-year in May. Apart from this, egg prices saw a rise of 15.16 per cent, while those of meat and fish gained by 9.03 per cent and pulses and products rose by 9.39 per cent. The vegetables segment slipped by (-) 1.92 per cent. However, the prices of fruits grew by 11.98 per cent.

Apart from food and beverages, the fuel and light segment also rose by 11.58 per cent, clothing and footwear gained 5.32 per cent and the housing segment inched up by 3.86 per cent.