Prices soar in Kashmir, retail inflation higher than national rate

Srinagar, Sep 12: Retail inflation in J&K reached 3.75 percent in August 2025, according to the latest Consumer Price Index (CPI) data released by the Ministry of Statistics and Programme Implementation. The figure continues to place the Union Territory above the national average of 2.07 percent, reflecting ongoing cost pressures on households across the region.

Compared to July, when retail inflation was 3.77 percent, the August figure shows a marginal decline. However, both rural and urban areas in the Union Territory saw rising price pressures.

In rural J&K, inflation increased to 1.69 percent from 1.18 percent in July, while in urban areas, it rose to 2.47 percent from 2.1 percent. Local consumers continue to feel the pinch of rising essentials. “Vegetables, eggs, and meat have become noticeably costlier this month,” said Parvez Ahmad, a Srinagar resident.

Government data highlights that the rise in prices was largely driven by kitchen essentials and personal care products. Vegetables, meat, fish, eggs, and edible oils saw the highest spikes, pushing overall retail inflation upward. Interestingly, annual food inflation in the Union Territory remained in slight deflation at -0.69 percent, suggesting uneven price trends across different food items.

The core inflation, which excludes volatile food and fuel items, inched up to 4.3 percent in August from 4.2 percent in July, maintaining a stable range observed over the past seven months. This indicates continued underlying demand pressures despite fluctuations in food prices.

At the national level, inflation trends also showed notable variations. Rural India recorded 1.69 percent inflation in August, up from 1.18 percent in July, while urban inflation increased to 2.47 percent from 2.1 percent. Among states, Kerala reported the highest inflation at 9.04 percent, while Assam experienced deflation of -0.66 percent, underscoring the uneven impact of supply and demand factors across the country.

Experts have highlighted the role of recent weather events in shaping price trends. Aditi Nayar, Chief Economist at Icra, said, “While kharif sowing has been generally healthy, excessive rains and localised flooding in late August and early September could affect crop yields, which may influence prices of vegetables, pulses, and staples in the coming months. Inflation dynamics will need careful monitoring.”

The Reserve Bank of India closely monitors retail inflation as a key parameter for its bi-monthly monetary policy, aiming to maintain a target of 4 percent with a tolerance band of ±2 percent. Analysts note that J&K’s inflation exceeding the national average signals sustained cost pressures for households, particularly in urban areas where essential commodities account for a large share of monthly expenditure.

The August CPI data underscores continuing inflationary challenges for Jammu and Kashmir. While the headline inflation shows a minor easing compared to July, rising rural and urban price indices, coupled with local spikes in essential food items, indicate that households continue to face significant cost pressures. The impact of recent weather disruptions on kharif crop yields will be a key factor influencing inflation trends in the coming months.