India’s Consumer Price Index (CPI) inflation fell to a seven-month low of 3.61% in February 2025, beating forecasts and setting the stage for a possible second consecutive interest rate reduction by the Reserve Bank of India (RBI) in the next month, The Hindu reported.
The key contributor to this dip was a slowdown in food inflation, particularly for vegetables and proteins. Consumer Food Price Inflation (CFPI) dipped drastically to 3.75% in February from 5.97% during January, an enormous 222 basis points in a mere one-month gap.
The National Statistical Office (NSO) pointed out that food inflation in February was the lowest since May 2023, providing huge relief in food prices.
Since inflation is now reassuringly within RBI’s target corridor of 4% (+/- 2%), the central bank had already reduced the repo rate by 25 basis points just last month. Experts are now expecting another reduction in the bi-monthly monetary policy review later this month, which is dated 9 April.
