India’s annual rate of inflation based on the Wholesale Price Index (WPI) slowed to a 13-month low of 0.85 per cent in April. It had stood at 2.05 per cent in March and 2.38 per cent in February, according to data released by the Ministry of Commerce and Industry on Wednesday.
The month-over-month change in WPI for April dropped into negative territory at (-) 0.19 per cent compared to March. This indicates a declining trend in inflation.
A fall in food prices and a double-digit drop in fuel prices contributed to the overall monthly inflation rate turning negative.
Meanwhile, the country’s retail inflation also eased. It dropped to 3.16 per cent in April from 3.34 per cent in March. This is the lowest level since July 2019, bringing some relief to household budgets. The Ministry of Statistics released this data on Tuesday.
Food inflation, which makes up nearly half of the Consumer Price Index (CPI) basket, slowed to 1.78 per cent in April. It had been 2.69 per cent in March.
This marks the third consecutive month that inflation has stayed below the RBI’s 4 per cent medium-term target. This gives the central bank room to maintain its soft monetary policy to support economic growth.
Retail inflation in India has continued its downward trend in recent months.
The Reserve Bank’s Monetary Policy Committee has cut its inflation forecast for 2025–26 to 4 per cent from 4.2 per cent. RBI Governor Sanjay Malhotra said this during the recent monetary policy review meeting. He added that the outlook for food inflation has turned decisively positive.
Concerns over Rabi crops have eased. The second advance estimates point to record wheat production and higher output of key pulses compared to last year. Combined with strong Kharif arrivals, this is expected to bring lasting relief in food inflation.
The latest RBI survey also shows a sharp decline in inflation expectations for three months and one year ahead. This will help keep inflation expectations stable going forward.
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