New Delhi [India], August 17 (ANI): The recent decline of global commodity prices, easing of some of the global supply-chain problems and absence of demand-side pressures seem to indicate retail inflation is past the peak, financial advisory firm Anand Rathi said in a report.

For the record, India's retail inflation fell to 6.71 per cent in July from 7.01 per cent in June, the lowest level in five months, helped by an easing in food and oil prices, as per the National Statistical Office (NSO) data.

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With this, retail inflation despite having moderated has been over the Reserve Bank of India's upper tolerance band of 6 per cent for the seventh consecutive month in a row.

Wholesale inflation too declined substantially during the month of July to 13.93 per cent, but continues to remain in double digits, official data released on Tuesday showed. The Wholesale Price Index (WPI) based inflation has been, however, in the double-digit for 16 months in a row now.

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"With the unfavorable base for food products, especially vegetables and cereals, we do not expect sharp softening until March 2023," the firm said in its report.

It believes the Reserve Bank of India's interest hike stance will continue.

"While we expect another 60 basis points rate hike by the RBI in this cycle, it is likely to be spaced out, and hikes would now be in smaller instalments," it added.

In line with the global trend of monetary policy tightening to cool off inflation, the RBI has so far hiked the key repo rates -- the rate at which the central bank of a country lends money to commercial banks -- by 140 basis points to 5.40 per cent. (ANI)

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