Retail inflation eased to 3.61 percent in February

The common people in the country have got some relief on the retail inflation front. The latest retail based inflation released by the government has come down to 3.61 percent in February, below 4 percent. The main reason for the decline in retail inflation in February is the reduction in the rate of increase in the prices of vegetables and protein-rich items. This has created scope for the Reserve Bank of India to cut the interest rate for the second time next month. This decline in February is only the third time in the current financial year that the inflation rate has come below 4 percent. The inflation figure was below the average of the MC poll of economists, in which inflation was estimated at 3.8 percent. According to the data, food inflation also came below 6 percent for the first time since September 2024.

How was the trend in food inflation

According to the news, the Consumer Price Index based retail inflation was 4.26 percent in January and 5.09 percent in February 2024. Data released by the National Statistical Office (NSO) shows that the year-on-year inflation rate for February 2025 was 3.75 per cent. Food inflation has seen a sharp decline of 222 basis points in February 2025 as compared to January 2025.

According to the latest NSO data, food inflation in February 2025 is the lowest since May 2023. The NSO said that the significant decline in headline inflation and food inflation during February is mainly due to a decline in inflation in vegetables, eggs, meat and fish, pulses and products; and milk and products.

Rates may be cut on April 9

The Reserve Bank of India (RBI), which is entrusted with the responsibility of maintaining retail inflation at 4 per cent (+/- 2 per cent), cut the short-term lending rate (repo) by 25 basis points last month to ease concerns on the inflation front. The central bank is scheduled to announce its next set of bi-monthly monetary policy on April 9.