Data | Medical expenses climb after second wave, adds to financial stress

The retail inflation rate remained high at 6.26% in June 2021, above the RBI's upper limit for the second consecutive month. A sharp surge in the cost of edible oils (34.7% y-o-y increase in June)

The rate remained high at 6.26% in June 2021, above the RBI's upper limit for the second consecutive month. A sharp surge in the cost of edible oils (34.7% y-o-y increase in June) followed by significant increases in the prices of egg, and light, fruits, and transportation contributed to the high inflation in June. In parallel, health costs expanded too, especially during the second wave of the COVID-19 pandemic. Health inflation increased to 8.4% and 7.7% in May and June 2021, respectively, from 3.8% in December 2019. A closer look at the health sub-group points to a consistent increase in the prices of medicines (8.6% y-o-y increase in June), medical tests (6.2%), hospital charges (5.9%), and consultation fees (4.5%). Health expenditure increased the most in Telangana and least in Kerala. The chart plots the inflation rates of select groups and sub-groups which contributed the most to the high inflation in June. Apart from edible oils and fats, eggs and fuel, the prices of fruits (11.8% y-o-y increase in June), clothing and footwear (6.2%), and household goods and services (5.8%) contributed to the rise.