Experts say inflation may rise again in June 2026:Find out here how RBI’s repo rate hike impacts common man

The Central Government is expected to publish the Consumer Price Index (CPI) based retail inflation data for June 2026 at 4 pm on Monday, 13 July, 2026. Generally, the MoSPI releases the inflation figures on 12th of every month but as this date falls on a Sunday this time in July so, we expect the government to roll out the official figures on Monday. Inflation trajectory since Iran war began CPI Inflation in India has started to rise of late due to the Iran war-led disruptions. The metric had edged higher to 3.93% in May, compared to 3.48% recorded in April. Infact, the annual percentage rise in goods and services prices in the country had been on an upward trajectory even before the US-Iran war had begun. In February 2026, the government quoted the metric to be at 3.21%. The government had last reported the figure to have risen to 3.93% in May 2026. And, now analysts expect it to breach the RBI’s 4% target in June 2026. Wholesale inflation rose to a 3-year 7-month high of 9.68% in May Wholesale price inflation had jumped to a 43-month high of 9.68% in May from 8.30% in April. Inflation may touch RBI’s 4% target for 1st time in 17 months The inflation figures had remained below the Reserve Bank of India’s (RBI) target of 4% for the 16th straight month in May. And analysts place the inflation metric above the apex bank’s target of 4% in June 2026. Impact of Iran war on India’s inflation – What RBI said? The RBI in the last held Monetary Policy Committee (MPC) June 2026 meet, had revised India’s FY27 inflation from 4.6% to 5.1%. Governor, Sanjay Malhotra had said that there were risks that inflation might rise in India due to high crude oil prices and probable weather disturbances because of El Nino. Albeit, that time, the prices of the global benchmark of oil, Brent crude, traded at elevated levels. Crude oil prices had risen by 71% in between the Iran war from $70 a barrel to as high as $120 per barrel for a brief period. This was expected to have a cascading effect on prices of those commodities that were especially shipped from the Gulf countries. Eventually, June 2026 would be the sixth straight month of rise in the country’s inflation based on the new base year series. Impact of rise in RBI’s repo rate on common man Due to renewed geopolitical tensions between the US and Iran, the odds are high that India’s central bank, the Reserve Bank of India (RBI) might go for a repo rate hike once in the current calendar year. The repo rate is the interest that the RBI charges commercial banks when they borrow money. If this rate goes up, borrowing money becomes expensive for banks. As a result, it changes how you spend and save your money. Here is how a rate hike may impact you: 1. Your loans will cost more (Higher EMIs) When it costs more for banks to borrow money, they pass that cost on to you. Existing Loans: If you have a home loan or a car loan with a floating (changing) interest rate, your monthly payment (EMI) will go up. Alternatively, you will have to pay your EMI for a longer number of months. New Loans: If you plan to buy a new house or car using a loan, it will cost you more than before. 2. Credit card debt will get heavier If you do not pay your credit card bill fully and on time, the interest you owe will become higher. It will become harder and more expensive to clear your credit card dues. 3. You will earn more on savings There is a bright side for people who love to save money. Higher FD Rates: To get more money from the public, banks will increase the interest they pay on Fixed Deposits (FDs) and savings accounts. You will earn more profit just by keeping your money safe in the bank. 4. Everyday prices might stop rising Why does the RBI raise this rate if it makes loans expensive? They do it to stop inflation. When loans cost more, people buy fewer things like cars, houses, or expensive clothes. When people buy less, shops and companies stop raising their prices. This eventually helps keep the prices of everyday items like vegetables, milk, and fuel stable. A repo rate hike means you will pay more for your loans, but you will earn more on your bank savings. It is the government’s way of slowing down spending to keep everyday prices under control. June 2026 inflation outlook: In the economist poll conducted by news dailies, ‘Mint’ and ‘Reuters’, the experts have pegged the inflation metric to breach RBI’s 4% target in June 2026. Govt to roll out inflation data for 6th time under new base year series 2024 The May 2026 inflation data is going to be the sixth time that the MoSPI would release inflation figures under the new base year 2024. Till December 2025, the Centre had rolled out figures of the annual percentage rise in prices of goods and services based on the old base year series of 2012. India updated the base year for the Consumer Price Index (CPI) to 2024 from erstwhile 2012, with an aim to provide a more accurate measure of inflation based on current consumption patterns in the country. Govt now considers higher number of items in the inflation basket to calculate how much prices have increased Under the new series 2024, the government increased number of items from 299 to 358 to calculate inflation. Number of products increased from 259 to 308 Services items were increased from 40 to 50 Examples of new items added to inflation basket: How inflation is calculated? Retail inflation is measured using the CPI, which tracks changes in prices of everyday items such as food, fuel and services. Inflation rises when demand outpaces supply and falls when supply exceeds demand.