India's Inflation Cools Down, RBI Maintains Positive Outlook

Retail inflation in India dropped to 3.34% in March from 3.61% in February, aided by a significant decrease in food prices. The Reserve Bank of India forecasts manageable inflation for the financial year 2025-26, with projections assuming a normal monsoon. Key inflation rates are predicted to remain steady.

Retail inflation in India cooled to 3.34% in March, a descent from February's 3.61%, as per data from the Ministry of Statistics & Programme Implementation. The consumer price index (CPI) core inflation eased slightly to 4.0% in March from 4.1% in February, indicating a favorable economic trend.

In March, rural CPI inflation slipped to 3.25% from 3.29% the previous month, while urban CPI experienced a slight rise to 3.43% from 3.32% in February. The food CPI notably dropped to 2.69% in March, down from 3.75% the month prior, marking the lowest level since November 2021.

The Reserve Bank of India (RBI) assures continued control over inflation for the financial year 2025-26, projecting CPI inflation at 4.0% contingent upon a normal monsoon. The RBI anticipates stable inflation rates across fiscal quarters, with a balanced outlook on future risks.