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India
India’s retail inflation cooled further in March 2025, dropping to 3.34 percent from 3.61 percent in February, according to the Ministry of Statistics & Programme Implementation data. The continued decline in food prices significantly contributed to the overall easing of consumer price pressures. The Consumer Price Index (CPI) food inflation slipped sharply by 106 basis points, falling to 2.69 percent in March from 3.75 percent in February. This marks the lowest level of food inflation since November 2021. Retail inflation fell below the 4 percent mark in February for the first time in six months.
Core Inflation Slightly Lower
Core inflation, which excludes volatile food and fuel items, also registered a marginal decline. The CPI core inflation stood at 4.0 percent in March, compared to 4.1 percent in February, the official data showed. The consistent moderation in core inflation reflects the steady performance of non-food and non-energy sectors, offering a sign of underlying price stability.
Urban Inflation Rises Slightly; Rural Inflation Dips
The rural CPI inflation dropped to 3.25 percent in March from 3.29 percent in February, showing slight improvement in price levels in rural areas. In contrast, urban CPI inflation rose to 3.43 percent in March from 3.32 percent in February. Despite the marginal uptick in urban areas, the overall inflationary trend remains on a downward trajectory.
RBI Projects Stable Outlook for FY26
On April 9, the Reserve Bank of India (RBI), in its monetary policy announcement, stated that inflation is expected to stay under control during the financial year 2025-26. RBI Governor Sanjay Malhotra projected the CPI inflation for the year at 4.0 percent, assuming a normal monsoon.
“The food inflation outlook has turned positive,” the RBI noted. “Vegetable prices have seen a broad and significant seasonal decline.”
The central bank expects inflation to average 3.6 percent in Q1, 3.9 percent in Q2, 3.8 percent in Q3, and 4.4 percent in Q4 of FY26. The RBI added that the risks to inflation are evenly balanced.
(With Inputs From ANI)
