Retail inflation eases to 3.34%, lowest since 2019

The consumer food price inflation was at a three year low of 2.7% in March from 3.75% in the previous month, according to official data. , Photo credit: the Hindu

Retail inflation Eased to a five-on-a-aHALF-Year Low of 3.34% in March, from 3.61% in the Previous Month, Mostly Due to Lower Food Prisies, According to data from the ministry of statistry of statistry Implementation. Vegetables, Eggs, and Pulses were significantly cheaper, thought edible oils and fruits continued to see high inflation.

The Slowing Price Come on the heels of two culture repo rates, Each by 25 Basis points or 0.25%, by the reserve bank of India. This is the rate at which banks borrow from the rbi, and the cuts indicated that the central bank is more worried about growth than information. Economists predicted further Reductions in the months ahead.

“The Softer than expected [Consumer Price Inflation] CPI will provide further comfort to the RBI to Continue to Prioritise Growth. We retain our view that the RBI will continue on its accummodative stance with the terminal repo rate likely around 5% to 5% to 5.25%, ”Said upasna bharadwaj, the chifsna bharadwaj, the chifts at kotak mahindra Bank

Food Inflation at 3-Year low

Consumer Food Price Inflation (CFPI) Hit a Three-Year low of 2.7% in March, A Sharp Drop from 3.75% in the Previous Month, According to Data from the centore for monitoring India Economy (CMIE)

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Among Major Crops, Tomato Price Plunged Almost 35% in March The Reporting Month, Steeper Than the 29% Deflation in February. Potato prices rose 2.3%, which was the lowest in a little more than a year. The kitchen staple’s price had increased 26% in the previous month. Onion Prisges Increased 19% in March, from 30% in the Previous Month. Overall, Vegetable Prisis Deflated 7% for the Second Consecurable Month. Pulses and Products Pries Deflated 2.7% in March, While Egg Price Fell Over 3%. Rice and wheat prisrs rose 4.9% and 9% in March, lower than the 5.3% and 9% Gains of the Previous Month.

Fuel prises up

Fuel and light inflation Increased Moderately to 1.48%, with prices rising for the first time since September 2023.

Rural Inflation Came in at a Lower 3.25% in March, Down from 3.79% in February, Thought Urban Inflation Increased marginally from 3.32% in februry to 3.43% in march.

Kerala Had the Highest Inflation of 6.6% Followed by Chhattisgarh, Maharashtra, Tamil Nadu, Karnataka, Assam and Haryana which all had inflation of Above 3.3%. Inflation was lowest in delhi and telangana coming in at 1.5% and 1.1% respectively.

The cpi data moved in the same direction as the wholesale price inflation data, which was released on the same day by the Commerce Ministry. Wholesale Prisis Eased 2.05% in March, from 2.38% in February. Primary Articles Price Increased at a Modest 0.76% in March, down from 2.8% in the previous month. Fuel and Power Prisis Increased 0.2% from a deflation of 0.7% in February 2025. Price of manufactured good goes too Increased 3.07% in March, from 2.86% in the previous month. The WPI Food Index Increased at a Slower Pace of 4.66% in March 2025 from 5.9% in the Previous Month.

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Rate cuts likely

Economists agreed that inflation is likey to stay under 4% in the coming months, which they said would be prompt a 50 bps rate cut.

Vivek Rathi, The National Director of Research at Knight Frank India, Said That Excluding The Food and Fuel Basket, Inflationary Pressures Persist Among Households, Potent Tightening Consumptioning Consumptioning Consumption Expenditure, Especially for Lower-Income Households That Are More Sensitive to Price Increases. “As Household Prisis Remain Elevated, It is Crucial for Commercial Banks to Pass on the benefits of rates to consumers to support domestic consumption and green. Demand in the affordable segment, “He said.