New Delhi, Feb 12 (UNI) Staying below Reserve Bank of India’s (RBI) comfort level, India’s retail inflation measured by consumer price index (CPI) eased to 4.31% year-on-year (YoY) in January 2025 from 5.22% in the previous month.
Headline inflation in January this year is the lowest year-on-year inflation after August, 2024.
As per data released by Ministry of Statistics & Programme Implementation (MoSPI) on Wednesday, food inflation declined to 6.02% in January this year as compared to 8.39% in the previous month.
“The food inflation in January, 2025 is the lowest after August, 2024,” said MoSPI in a press release.
The significant decline in headline inflation and food inflation during the month of January, 2025 is mainly attributed to decline in inflation of vegetables, egg, pulses & products, cereals and products, education, clothing and health.
With retail inflation staying below its comfort level, the RBI’s monetary policy committee (MPC) last week decided to cut the repo rate by 0.25% to 6.25%.
The central bank has projected CPI inflation for the current financial year 2024-25 at 4.8%. Assuming normal monsoon, retail inflation is estimated at 4.2% in 2025-26.
The RBI is tasked to maintain inflation at 4% with a margin of 2% on either side.
As per MoSPI data, significant decline in headline and food inflation in the rural sector has been observed in January 2025.
Commenting on January inflation data, ICRA chief economist Aditi Nayar said, “The considerable moderation in vegetable prices is likely to augur well for the YoY food and beverages inflation print for the month, which is expected to ease to a six-month low of ~5.2% in February 2025.”
