Food inflation News

Iran-Israel conflict 2025 drived oil prices up, threatening higher fuel, food costs in India.  

The RBI also announced a 100 basis point cut in the Cash Reserve Ratio (CRR), from 4 per cent to 3 per cent, to be implemented in four tranches of 25 bps each. 

The RBI now expects inflation to remain below or near target throughout the year, with CPI projections set at 2.9 per cent for Q1, 3.4 per cent for Q2, 3.9 per cent for Q3, and 4.4 per cent for Q4.

Food inflation dropped to 1.78 per cent in April, down from 2.69 per cent in March and a sharp fall compared to 8.7 per cent in the same month last year.

The moderation was driven by record low core inflation at 3.5 per cent (vs 4.3 per cent in fiscal 2024), while food inflation was volatile and high at 7.3 per cent (vs 7.5 per cent). 

The RBI Governor observed that along with robust kharif arrivals, this is expected to set the stage for a durable softening of food inflation. 

Food inflation in February dropped to its lowest level since May 2023, falling 222 basis points compared to January, as per official data. 

Food inflation, a major component of retail inflation, is estimated to have fallen further to 4.66 per cent in February 2025, marking a significant decline.  

For FY26, the government has targeted a 7.4 per cent increase in capex, signaling a commitment to investment in infrastructure while continuing to reduce subsidy allocations. 

The top five items showing the highest year on year Inflation at the All India level in January are coconut oil (54.20 per cent), potato (49.61 per cent), coconut (38.71 per cent), garlic (30.65 per cent), peas [vegetables] (30.17 per cent). 

In India, domestic financial conditions improved marginally on-month in December. The CRISIL Financial Conditions Index (FCI), an indicator capturing parameters from India’s major financial market segments, rose to 0.5 from 0.4 in November. 

The RBI kept the key policy repo rate unchanged at 6.5 per cent for a ninth consecutive meeting on Thursday as it continues to maintain a balance between accelerating economic growth and keeping inflation under control.

However, retail inflation declined to a five-month low of 4.85 per cent in March mainly due to cooling food prices. 

Food inflation rose to 8.18 per cent in November, from 2.53 per cent in October, said the Commerce and Industry Ministry said in a statement.

India retail inflation dips to 5.88%. It is below than RBI's tolerance band. RBI hiked repo rate fourth-time by 35 basis points in recent MPC meeting.

On the out-of-turn MPC meeting, SBI Research report said it is only a part of the regulatory obligation and it does not foresee any other agenda to be announced at the meeting, even as it is scheduled a day after the US Fed`s meet on November 2.

Earlier this month, CPI inflation came in at an eight-month high of 6.1 per cent YoY in February 2022. Besides, food inflation came in at a 15-month high of 5.8 per cent YoY in February 2022 versus 5.4 per cent YoY a month ago. On the contrary, fuel and power inflation came in at a 10-month low of 8.7 per cent YoY in February 2022.

The government data released on Monday showed that inflation in food articles tapered to 2.04 percent in September, as against 5.75 percent in August on an yearly basis.

The August inflation number is the highest since March 2017, when it was recorded at 3.89 percent.

India`s retail inflation is expected to have picked up slightly in July after cooling in the previous three months, a Reuters poll showed, but likely remained well below the central bank`s 4 percent medium-term target.