Retail Inflation Drops to Six-Year Low Amid Monsoon Relief

Retail inflation in India fell to a six-year low of 2.1% in June 2025, due to decreased prices in food items influenced by a widespread monsoon. This continues a downward trend since November 2024, fueled by reductions in vegetables, pulses, and spices prices. Rural inflation was notably lower than urban.

Retail inflation in India has plummeted to a six-year low, reaching 2.1% in June 2025. This notable decrease is largely attributed to reduced prices in food categories, including vegetables, pulses, and spices, driven by beneficial monsoon effects, as reported by the National Statistics Office (NSO).

According to NSO data, the Consumer Price Index (CPI)-based inflation saw a significant deduction from 2.82% in May 2025 to 2.1% in June 2025. Lower food prices and a favorable base effect were major contributing factors to this trend, highlighted alongside a continuing decline since November 2024.

Analysts, such as Aditi Nayar and Paras Jasrai, noted contrasting trends with core inflation rising due to luxury items, while Garima Kapoor anticipated potential monetary easing despite inflation rates falling well below RBI targets.