In its monthly economic review for October, the Finance Ministry on Monday said the food inflation is expected to calm down in the next few months on the likelihood of a bumper kharif harvest.

The review said India’s retail inflation jumped in October to 6.21%, a 14-month high, driven by elevated food inflation in a “few vegetables”.

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“Supply disruptions from heavy rains in major producing states contributed to price pressures in tomatoes, onions, and potatoes, while elevated global prices drove up oil and fat inflation.” It said.

Moreover, a favourable monsoon, adequate reservoir levels and higher minimum support prices are likely to boost rabi sowing and production.

The Finance Ministry in its report highlighted that the Indian economy is holding its ground despite mixed global outlook.

“Early November trends signaled moderation in key food prices, though geopolitical factors may continue to impact domestic inflation and supply chains,” it said.

Many high-frequency indicators of economic activity have shown a ‘rebound’ in October amid a clouded global economy and a brief period of softening momentum over the monsoon months, it said.

Further on the employment front, the report said the formal workforce is expanding, with notable increases in manufacturing jobs and a strong inflow of youth into organised sectors.

The Finance Ministry also said that India expects the economy to grow at 6.5%-7% in the financial year that ends in March.

According to the latest government data, the Consumer Price Index (CPI) inflation for October was recorded at 6.21% on Year-on-year basis. Corresponding inflation rates for rural and urban areas are 6.68% and 5.62%, respectively.

Year-on-year inflation rate based on the All India Consumer Food Price Index (CFPI) number was 10.87% (Provisional) for October. Corresponding inflation rates for rural and urban areas were 10.69% and 11.09%, respectively.