India’s retail inflation, based on the Consumer Price Index (CPI), for April stood at 3.16 per cent, down from 3.34 per cent in March, data released by the Ministry of Statistics & Programme Implementation showed on Tuesday. This is down 18 basis points in comparison to March 2025. It is the lowest year-on-year inflation after July, 2019. CPI inflation in October had reached a 14-month high of 6.21 per cent.
The YoY inflation rate based on All India Consumer Food Price Index (CFPI) for the month of April 2025 over April 2024 is 1.78 per cent (provisional). Corresponding inflation rates for rural areas stood at 1.85 per cent and urban inflation at 1.64 per cent, the NSO data showed. April witnessed a sharp decline of 91 basis point in food inflation in comparison to March 2025. The food inflation in April 2025 is the lowest after October 2021.
A significant decline in headline and food inflation in the rural sector was observed in April 2025 at 2.92 per cent (provisional) while the same was 3.25 per cent in March 2025. Urban inflation was at 3.36 per cent (provisional) in April 2025 as against 3.43 per cent in March 2025. However, sharp decline is observed in food inflation from 2.48 per cent in March 2025 to 1.64 per cent in April 2025.
Vegetable inflation dropped to -10.98 per cent in April from -7.04 per cent in March, pulses and products inflation stood at -5.23 per cent as against -2.73 per cent in March. While Cereals and Products inflation came in at 5.35 per cent, milk and products inflation stood at 2.72 per cent. Fuel and light inflation came in at 2.92 per cent.
According to the NSO data, housing inflation came in at 3.00 per cent in April from 3.03 per cent in March, while clothing and footwear inflation stood at 2.67 per cent in April as against 2.62 per cent in March. Inflation for health was at 4.25 per cent in April and education inflation came in at 4.13 per cent.
Reacting on this, Aditi Nayar, Chief Economist & Head-Research & Outreach at ICRA Limited, said, “With the vegetable index dipping further, and compressing the food inflation the headline CPI inflation eased further to a 69 month low 3.16 per cent in April 2025. While the recent rise in temperatures in North India and unseasonal rainfall in parts of peninsular India may cause a spike in vegetable prices in the second half of May, boosting the CPI inflation print, we project it to print around 3.5 per cent in the ongoing month.”
She further added, “The benign April 2025 headline inflation print, expectations of another sub-4 per cent print in May 2025, the dip in crude oil prices in the recent weeks, and the IMD’s forecast of an above normal monsoon in 2025 as well as an early onset in Kerala will allow the MPC to continue to place a higher weight on growth vis-à-vis inflation, when it meets in June 2025.”
ICRA anticipated the CPI inflation to average 3.5 per cent in FY26, with the prints for Q2 and Q3 sharply trailing the MPC’s projections for these quarters, allowing for an additional 75 bps of rate cuts in this calendar year.