Data | Tomato inflation accelerated to 200% in July; Tamil Nadu, Andhra and Karnataka most hit Premium

Retail inflation of tomatoes surged to over 200% in July, pushing up vegetable inflation to 37%. This, in turn, drove food and beverage inflation to 10.5%, the highest in 40 months. This was the major reason behind the sharp rise in retail inflation (7.4%) in July, the highest in 15 months. Tomato was the major driver of vegetable inflation, while potato deflation had a considerable impact in pulling down overall vegetable inflation.

Retail inflation of tomatoes accelerated to over 200% in July — the highest-ever since at least January 2015. This in turn pushed up vegetable inflation, which quickened to 37%, leading to food and beverage inflation accelerating to 10.5% — both highest in 40 months. This was the major reason behind the sharp spike in retail inflation (7.4%) in July, the highest in 15 months.

Chart 1 | The chart shows the retail inflation of tomatoes, vegetables, food and beverages and all products combined between January 2015 and July 2023.

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While deciding which items drove up or down inflation, it is imperative to consider the weight each item carries in the final inflation calculation.

Table 2 | The table shows the main groups which constitute the retail inflation calculation. Their weights in the inflation calculation and their retail inflation in July 2023 are mentioned.

The main group includes food & beverages, clothing & footwear, housing, intoxicants and fuel & light. As shown in Table 2, in July 2023, the food and beverages group’s inflation accelerated to 10.5%, the highest among all groups. More importantly, the food and beverages group carries the most weight in the retail inflation calculation. Put together, the component which carries the biggest weight in inflation calculation, recorded the most inflation, leading to the rapid increase in retail inflation from 4.87% in June to 7.44% in July.

Table 3 | The table shows the sub-groups which constitute the food and beverages main group. Each sub-group’s weight in the inflation calculation and its retail inflation in July 2023 are mentioned.