New Delhi— India’s retail inflation cooled to 3.16% in April, down from 3.34% in March, marking its lowest level since July 2019. The decline, driven primarily by easing food prices, is expected to provide relief to households and support the Reserve Bank of India’s accommodative monetary stance.
According to data released by the Ministry of Statistics on Tuesday, food inflation—which makes up nearly half of the Consumer Price Index (CPI) basket—fell to 1.78% in April, compared to 2.69% in March.
This marks the third consecutive month that retail inflation has remained below the Reserve Bank’s medium-term target of 4%, creating room for the central bank to maintain its pro-growth monetary policy.
India’s annual CPI inflation had already eased to 3.34% in March, its lowest point since August 2019, continuing a downward trend in price pressures across the economy.
The Reserve Bank of India (RBI) recently revised its inflation outlook downward for FY2025-26, projecting headline inflation at 4.0%, down from its earlier estimate of 4.2%. RBI Governor Sanjay Malhotra attributed the improved outlook to a decisive shift in food inflation dynamics.
“The uncertainties surrounding the rabi crop have eased significantly,” Malhotra noted during the latest monetary policy review. “Second advance estimates point to record wheat output and increased production of key pulses compared to last year. Combined with robust kharif arrivals, this should lead to a sustained moderation in food inflation.”
He also highlighted a notable decline in inflation expectations based on the RBI’s latest survey, which is expected to help anchor future inflation.
The recent decline in global crude oil prices has further improved the inflation outlook. However, Malhotra cautioned that risks remain, particularly due to global market volatility and potential weather-related disruptions that could affect food supply.
Assuming a normal monsoon, the RBI has forecast CPI inflation for FY2025-26 at 4.0%, with quarterly projections as follows: 3.6% in Q1, 3.9% in Q2, 3.8% in Q3, and 4.4% in Q4. The central bank views the risks to this forecast as broadly balanced. (Source: IANS)
