Macro Report · 1 min read · June 15th

Inflation Data for May

Headline Inflation

  • Headline inflation edged up year-on-year to 15.93% in May 2026 from 15.69% in April, but declined significantly compared to 26.06% in May 2025. On a month-on-month basis, inflation also eased to 1.75% in May from 2.13% in April.
  • Key Drivers:
  • Food & Non-Alcoholic Beverages contributed the largest share to inflation (6.38% YoY; 0.70% MoM)
  • The decline in month-on-month inflation reflects softer price pressures relative to April's energy-driven surge, although inflationary pressures remain elevated.

Food Inflation

  • Month-on-month food inflation eased further to 2.98% from 3.63% in April, though food prices remain elevated. Year-on-year food inflation moderated to 16.96% from 24.55%, while the decline in month-on-month was driven by slower increases in the average prices of items such as onions, maize, grains, etc.

Core Inflation

  • Core inflation (YoY) slowed to 16.82% from 24.92% in May last year, indicating easing underlying price pressures. On a month-on-month basis, core inflation increased to 1.94% from 1.03% in April, indicating a rise in short-term price pressures across key sectors.

Outlook

  • Year-on-year inflation remained elevated, while month-on-month continued to ease from March's spike in the wake of the US-Iran war, though still reflecting energy-driven volatility. The interim US–Iran ceasefire agreement and expected reopening of the Strait of Hormuz could help moderate short-term inflation pressures.