New Delhi–India’s annual retail inflation shot up beyond the official tolerance level of 6 per cent for July mainly on higher food prices like pulses and vegetables, while on the brighter side the factory output rose 2.1 per cent in June, official data showed on Friday.

The retail inflation, based on the Consumer Price Index (CPI) of the Central Statistics Office (CSO), rose to this level from 5.77 per cent in June and 3.69 per cent in the like period of last year. The annual retail inflation for rural India was 6.66 per cent.

Importantly, the annual food inflation has been galloping. It was 8.35 per cent for the whole of India, 8.25 per cent in rural areas and 8.80 per cent in the urban conclaves. Among the food items, the annual rise was 27.53 per cent for pulses and 14.06 per cent for vegetables.

In the case of factory output, as revealed by the Index of Industrial Production (IIP), the 2.1 per cent growth in June came against the backdrop of a 1.1 per cent growth in in May this year, and 4.2 per cent rise in the corresponding month of the previous year.

Among the three major sub-indices of the IIP, that for electricity expanded the fastest by 8.3 per cent, followed by 4.7 per cent for mining, while the manufacturing index, that has the maximum weight of over 75 per cent, grew at a relatively lower pace of 0.9 per cent.

The official data on the price situation comes precisely a week after the government fixed an annual inflation target of 4 per cent, plus or minus two percentage points, for the next five years — which will be the mandate for the Reserve Bank of India to follow.