Retail inflation broke a nine-month declining streak in August 2025, quickening to 2.1% from 1.6% in July 2025, in accordance to official information. The inflation in August was marginally greater than the decrease sure of the Reserve Bank of India’s consolation band of 2-6% for retail inflation.
The price of retail inflation had been declining each month since November 2024.
The information launched by the Ministry of Statistics and Programme Implementation on Friday (September 12, 2025) confirmed that the inflation in the meals and drinks class remained flat in August 2025, at 0.05%, in contrast to 5.3% in August final yr.
“Within food products, the main drivers of low inflation are vegetables and pulses which recorded -15.9% and -14.5% respectively,” in accordance to a notice by the Bank of Baroda’s economics analysis wing. “Oils continue to exert upward pressure with 21.2% inflation due to higher global prices as well as low base effect.”
Inflation in the clothes and footwear class remained nearly unchanged at 2.67% in August 2025 in contrast with 2.62% in July. Similarly, inflation in the housing phase stood at 3.06% in August in contrast with 3.03% in July.
The gasoline and light-weight class noticed a comparatively sooner enhance in inflation, which quickened to 2.9% in August 2025 from 1.4% in July.
According to Upasna Bhardwaj, Chief Economist at Kotak Mahindra Bank, the the GST price minimize impression is probably going to play out in the yr forward, partly offsetting the impression of an hostile base impact in 2026-27.
“While we see a pause by the RBI in the upcoming policy, we do see some scope for rate cuts worth 25-50 basis points opening up from December policy if downside risks to growth materialise and the Fed moves ahead with aggressive rate cuts,” she stated.
