As food prices increased more slowly, India's annual retail inflation dropped from 3.34 percent in March to 3.16 percent in April, its lowest level in over six years, according to government data.

Inflation has been below the Reserve Bank of India's medium-term objective of four percent for the third consecutive month.

Inflation in food, which makes up almost half of the Consumer Price Index (CPI) basket, decreased from 2.69 percent in March to 1.78 percent in April.

This summer's extreme heatwaves had minimal effect on a bountiful harvest, providing much-needed respite to numerous Indian households that spend a large percentage of their income on food.

While urban inflation shrank to 3.36 percent from 3.43 percent in March, rural inflation fell to 2.92 percent in April from 3.25 percent in March.

Inflation based on the Consumer Price Index (CPI) was 3.34 percent in March 2024 and 4.83 percent in April 2024. In July 2019, it stood at 3.15 percent.

The RBI has more leeway to lower interest rates in order to boost a faltering economy because inflation is expected to remain low.

 

In his announcement of the Monetary Policy Committee's ruling last month, RBI Governor Sanjay Malhotra stated that a positive outlook for food prices has helped to keep inflation on a downward trajectory.

He pointed out that further inflation relief is anticipated in FY26, which might help people struggling with rising expenses. The central bank did, however, warn that it is still vigilant about world events.

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According to the central bank, CPI inflation will be 4.4 percent in the fiscal year 2025–2026, with Q1 being 3.6 percent, Q2 being 3.9 percent, Q3 being 3.8 percent, and Q4 being 4.4 percent.