Retail CPI inflation eases to 7-month low of 3.61% in February; January IIP growth at 5%

Retail inflation or Consumer Price Index (CPI) inflation for the month of February eased to a 7-month low of 3.61%. This is well within the Reserve Bank of India (RBI’s) comfort zone and will likely encourage the Monetary Policy Committee (MPC) to cut repo rate in the April review to boost GDP growth.
The All India Consumer Price Index (CPI) shows a year-on-year inflation rate of 3.61% (Provisional) for February 2025 compared to February 2024. The headline inflation in February 2025 decreased by 65 basis points from January 2025, reaching its lowest level since July 2024.
Food inflation or the All India Consumer Food Price Index (CFPI) indicates a year-on-year inflation rate of 3.75% (Provisional) for February 2025 over February 2024. The rural and urban rates stand at 4.06% and 3.20% respectively. Food inflation experienced a substantial decrease of 222 basis points in February 2025 compared to January 2025, marking the lowest level since May 2023.
In the rural sector, February 2025 witnessed a notable decline in both headline and food inflation. The headline inflation registered at 3.79% (provisional), down from 4.59% in January 2025. The rural CFPI-based food inflation decreased to 4.06% in February 2025 from 6.31% in January 2025.
The urban sector experienced a considerable reduction in headline inflation, dropping to 3.32% (Provisional) in February 2025 from 3.87% in January 2025. Food inflation in urban areas also showed a similar trend, declining to 3.20% in February 2025 from 5.53% in January 2025.
January 2025 IIP Data:

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