Data Alert
Jan CPI inflation at 5-month low of 4.31% on fall in food prices
This story was originally published at 17:06 IST on 12 February 2025
Register to read our real-time news.Informist, Wednesday, Feb. 12, 2025
Please click here to read all liners published on this story
--India Jan CPI inflation 4.31% vs 5.22% Dec
--Informist poll estimated India Jan CPI inflation at 4.5%
--India Jan CPI food inflation 6.02% vs 8.39% Dec
--India Jan CPI rural inflation 4.64% vs 5.76% Dec
--India Jan CPI urban inflation 3.87% vs 4.58% Dec
--India Jan CPI general index down 1.0% on month
--India Jan CPI food price index down 2.9% on month
--India Jan CPI cereals and products index up 0.5% on month
--India Jan CPI vegetable index down 15.7% on month
--India Jan CPI pulses and products index down 2.1% on month
--India Jan CPI oils and fats index up 0.2% on month
--India Jan CPI food, beverage index down 2.4% on month
--India Jan CPI housing index up 0.4% on month
--India Jan CPI clothing, footwear index up 0.2% on month
--India Jan CPI fuel and light index up 0.3% on month
--India Jan CPI miscellaneous index up 0.4% on month
--India Jan CPI inflation of 4.31% lowest in 5 months
--India Jan CPI core inflation 3.7% vs 3.6% Dec
NEW DELHI – India's headline CPI inflation fell to a five-month low of 4.31% in January from 5.22% in December, led by lower vegetable prices, data released Wednesday by the statistics ministry showed. The CPI inflation was 5.10% in January 2024.
At 4.31%, CPI inflation in January was below the consensus expectation. According to an Informist poll, the headline inflation was seen at 4.5%.
CPI food inflation eased to a five-month low of 6.02% in January from 8.39% in December, as food prices fell 2.9% month-on-month. Thanks to the sequential fall in food prices, the general index of the CPI was down 1.0% compared to December.
This is the third straight month headline retail inflation has declined and the January print is the closest one to the Reserve Bank of India's medium-term target of 4% since August. The RBI's Monetary Policy Committee last week lowered the repo rate after almost five years, cutting it by 25 basis points to 6.25%, citing the need to support growth with inflation expected to moderate going ahead.
The RBI has forecast CPI inflation for 2025-26 (Apr-Mar) at 4.2%, 60 bps lower than the 4.8% projected for the current year. The GDP growth projection for FY26 is 6.7%, only 30 bps higher than the estimated 6.4% for this year. Economists expect the MPC to lower the repo rate by another 25 bps in April, and the inflation print for January will only increase such expectations.
The bulk of the disinflation in January was led by vegetable prices, which fell 15.7% on month, and pulses prices, which fell 2.1% from December. Lower vegetable and pulses prices led to a 2.9% on-month decline in the food price index, which is the biggest sequential fall since December 2020. Even the 1.0% on-month fall in the general CPI index was the largest sequential decline in 16 months.
"The sharp fall in Indian headline consumer price inflation in January reinforces our view that the RBI will continue to loosen monetary policy over the coming months to support the economy," Harry Chambers, assistant economist at Capital Economics, said in a note.
While food inflation declined in January, core inflation increased slightly compared to December. Core inflation--which excludes food and fuel items, prices of which can be volatile--rose to 3.7% from 3.6% in December. Three of the four components of core inflation saw a sequential uptick in January.
The housing index rose 0.4% on month in January, while the clothing and footwear, and the miscellaneous indices were up 0.2% and 0.4%, respectively. Within miscellaneous, the personal care and effects index rose 1.0% from December, reflecting the rise in gold prices during January.
The following table details sequential and annual increase in the main components of the CPI (Combined):
| Weight | Index for January | Month-on-month change (in %) | Year-on-year change (in %) | ||
| January | December | ||||
| Cereals and products | 9.67 | 199.1 | 0.5 | 6.24% | 6.51% |
| Meat and fish | 3.61 | 224.4 | 0.9 | 5.25% | 5.30% |
| Egg | 0.43 | 207.9 | (-)2.0 | 1.27% | 6.85% |
| Milk and products | 6.61 | 187.9 | 0.2 | 2.85% | 2.80% |
| Oils and fats | 3.56 | 184.1 | 0.2 | 15.64% | 14.60% |
| Vegetables | 6.04 | 217.8 | (-)15.7 | 11.35% | 26.56% |
| Pulses and products | 2.38 | 209.6 | (-)2.1 | 2.59% | 3.83% |
| Sugar and confectionery | 1.36 | 130.5 | (-)0.3 | 0.31% | 0.23% |
| Spices | 2.5 | 225.8 | (-)0.7 | (-)6.85 | (-)7.41% |
| Food and beverages | 45.86 | 200.9 | (-)2.4 | 5.68% | 7.69% |
| Pan, tobacco and intoxicants | 2.38 | 209.4 | (-)0.1 | 2.30% | 2.49% |
| Clothing and footwear | 6.53 | 195.1 | 0.2 | 2.68% | 2.74% |
| Housing | 10.07 | 182.5 | 0.4 | 2.76% | 2.71% |
| Fuel and light | 6.84 | 178.4 | 0.3 | (-)1.38 | (-)1.33% |
| Miscellaneous | 28.32 | 187.2 | 0.4 | 4.35% | 4.19% |
| General Index | 100 | 193.5 | (-)1.0 | 4.31% | 5.22% |
| Consumer Food Price Index | 39.06 | 200.7 | (-)2.9 | 6.02% | 8.39% |
End
Reported by Shubham Rana
Edited by Ashish Shirke
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.
Informist Media Tel +91 (11) 4220-1000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2025. All rights reserved.
To read more please subscribe
Share this Story:
