Inflation Alert: India’s Retail Inflation Crashes To 1.55% — Lowest In 8 Years!

India’s Retail Inflation Eases Sharply to 1.55% in July 2025, Lowest Since 2017

India’s retail inflation, measured by the Consumer Price Index (CPI), dropped sharply to 1.55% year-on-year in July 2025, marking the lowest level since June 2017. The Ministry of Statistics and Programme Implementation released the data on Tuesday, showing a 55 basis point decline from June’s 2.10%. This easing reflects falling prices in key sectors and a favorable base effect. Food inflation dipped further into negative territory at -1.76%, the lowest since January 2019, driven by price declines in pulses, vegetables, cereals, eggs, sugar, and transport services. Both rural and urban areas recorded a significant drop in inflation, offering relief amid ongoing global economic uncertainties.

Food And Fuel: Inflation Trends To Watch

Food inflation based on the Consumer Food Price Index (CFPI) dropped further, with pulses, vegetables, cereals, and confectionery prices all easing. Rural food inflation fell to -1.74%, down from -0.87% in June, while urban food inflation slipped to -1.90% from -1.17%. The transport and communication sector saw a sharp drop in inflation, sliding from 3.90% in June to 2.12% in July. Meanwhile, fuel and light inflation inched up slightly to 2.67%, compared to 2.55% last month. These contrasting movements reflect softer demand in some areas but persistent cost pressures in others.

Sector-Wise Inflation: Mixed But Mostly Downward

Housing inflation remained steady at 3.17%, almost unchanged from June’s 3.18%. Education inflation eased to 4.00%, down from 4.37%, showing moderation in schooling-related costs. Health inflation rose slightly to 4.57% from 4.38%, indicating some upward pressure in medical expenses. Overall, most sectors demonstrated easing inflation, helping to moderate the headline numbers. This varied sectoral performance suggests a cautiously optimistic outlook for inflation in the near term, balancing falling food prices against rising health and fuel costs.

What This Means: Inflation Eases Across India

• CPI inflation fell sharply to 1.55%, lowest since 2017
• Food inflation dropped to -1.76%, driven by pulses, cereals, and vegetables
• Rural inflation eased to 1.18%, urban to 2.05%
• Transport inflation dropped significantly; fuel inflation slightly up
• Education and housing inflation eased; health inflation rose marginally

(With Inputs From ANI)

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