India’s retail inflation falls to 3.34% in March, lowest since August 2019

India’s annual retail inflation, measured by the Consumer Price Index (CPI), eased to 3.34% in March 2025—the lowest level since August 2019—according to data released by the Ministry of Statistics on Tuesday. Food inflation also slowed significantly during the month, dropping to 2.69%, its lowest since November 2021. The notable decline in both headline and food inflation is primarily attributed to a reduction in the prices of key food items such as vegetables, eggs, pulses, meat and fish, cereals, and milk, the ministry noted.Housing inflation stood at 3.03% in March, slightly higher than February’s 2.91%. Notably, the housing index is compiled only for the urban sector. Fuel and light inflation was recorded at 1.48%, while education inflation for the month came in at 3.98%, the data showed.

India's wholesale price index (WPI) inflation eased to a four-month low of 2.05% in March, down from 2.38% in January, according to data released by the Ministry of Commerce and Industry on Tuesday. The reading came in below economists’ expectations of 2.5%, as projected in a poll recently. The moderation in wholesale inflation was led by a notable slowdown in food and primary articles inflation. Wholesale food inflation decelerated to 4.66% in March from 5.94% in February, while primary articles inflation dropped sharply to 0.76%, down from 2.81% the previous month. Fuel and power prices showed a mild increase, rising by 0.20% in March compared to a contraction of 0.71% in February.
Meanwhile, manufactured products inflation, which makes up nearly 64% of the WPI basket, continued its upward trend, increasing by 3.07%, up from 2.86% a month earlier.The government attributed the positive rate of WPI inflation in March primarily to price increases in food product manufacturing, textiles, electricity, and other manufacturing categories. However, the relief from easing wholesale prices may be short-lived. Rising summer temperatures and heatwave warnings issued by the India Meteorological Department have triggered concerns over potential food price spikes in the coming months.
“As weather turns less supportive and temperatures rise during summer months, vegetable and fruit prices are expected to start climbing seasonally,” Rahul Bajoria, Head of India and ASEAN Economic Research at BofA Global Research, reportedly stated.This outlook comes amid signs of broader price stability. India’s retail inflation had already eased to a seven-month low of 3.61% in February from 4.31% in January. Economists believe inflation may face renewed upward pressure if unfavorable weather hampers agricultural output during the peak summer months.

(Business Correspondent)