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

NEW DELHI:

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%.

The moderation in headline inflation number is largely a result of a fall in food inflation, which came down from 9% in November to 8.4%.