FY25 Retail Inflation at 4.6%, Lowest Since FY19

March inflation at 3.3%, below the 3.5% projected, positively surprises analysts

- Roshan Kishore

NEW DELHI: Retail inflation, measured by Consumer Price Index (CPI), hit 4.6% in fiscal year 2024-25, the lowest since 2018-19's 3.4%, validating the Reserve Bank of India's pro-growth monetary policy pivot.

On a quarterly basis—the timeframe RBI's Monetary Policy Committee (MPC) uses for forecasts—headline inflation reached 3.7% in the quarter ending March 31, dipping below the 4% target for the first time since September 2019.

With India's crude oil basket falling below $70 per barrel and the India Meteorological Department forecasting above-normal monsoon, the economy faces its most benign inflation outlook in years. To be sure, global economic turbulence from Trump's trade war and slowing post-pandemic growth suggest policymakers may need to prioritize growth over inflation concerns going forward. Low inflation will definitely help rather than hurt in pursuing this cause.