Inflation in India accelerated last month, exceeding the central bank's target level for the first time in nearly a year and a half, keeping policymakers on alert.

According to official data released on Monday, the Consumer Price Index rose 4.38% year-on-year in June. This figure surpassed the median forecast of 4.20% from a survey of economists and moved above the Reserve Bank of India's 4% target, though it remains within the central bank's tolerance band of 2% to 6%. The inflation rate in May was 3.93%.

Despite this, the latest inflation reading is unlikely by itself to shift the policy stance of the Reserve Bank of India. Governor Sanjay Malhotra stated last month that action would only be considered if price pressures broadened, while the bank continues to monitor developments in the oil market and the impact of monsoon rains closely.

In its last policy meeting, the central bank held its benchmark policy rate steady at 5.25% and raised its inflation forecast for the fiscal year ending in March to 5.1%.