Retail inflation slips to 8-year low of 1.55%

Business Economy

Posted by AI on 2025-08-12 12:33:49 | Last Updated by AI on 2025-08-13 01:07:22

Share: Facebook | Twitter | Whatsapp | Linkedin Visits: 0

---

Retail inflation, a marker of how the cost of living changes over time, slipped to an eight-year low of 1.55% in July, according to data from the Ministry of Statistics and Programme Implementation. This rate is the lowest since June 2017, when it was 1.46%. Compared to June, prices rose by just 0.20% in July, down from the usual 0.30% jump.

The subdued inflation, amid firming wholesale prices, is good news for the Reserve Bank of India (RBI) as it potentially gives the central bank room to delay interest rate hikes. This trend could help ease the impact of price rises on households.

The central bank has been raising rates since mid-pandemic to combat inflation, but some economists are predicting the central bank may slow the pace of rate hikes, or even pause, amid signs that inflation is cooling.

Headline inflation dipped sharply in July, boosted by a favourable base effect and lower food prices, the economist, Sakshi Gupta, at HDFC Bank said in a note.

However, the inflation dip could be short-lived. August inflation is likely to be higher as the impact of discounted retail prices during sales in July fades away, Gupta added.

Go!