Retail inflation eases to 4-month low in Dec

A moderation in vegetable inflation led to a fall in retail inflation in the month of December 2024, bringing the headline number down to a four-month low of 5.2%.

- Auhona Mukherjee

This number is in line with private and RBI forecasts and, according to economists, keeps open the possibility of RBI's Monetary Policy Committee cutting interest rates in its February meeting. A rate cut could provide relief to both households and businesses by bringing down borrowing costs.

Retail inflation, as measured by the Consumer Price Index (CPI), came in at 5.2% in December 2024, according to data released by the National Statistical Office (NSO) on Monday. December's inflation print is 26 basis points—one basis point is one hundredth of a percentage point—lower than the November inflation reading. The December CPI value was the lowest since August 2024 when it was 3.7%. December CPI numbers are broadly in line with the forecast by a Bloomberg poll of economists which had projected this number to be 5.3%.