Retail inflation improves in November: CPI inflation rises to 0.71%; check details

Consumer Price Index-based retail inflation remained below the RBI's 4% inflation target for the 10th month in a row. Also, November is the second month when retail inflation has remained below 1% level in the current CPI series which has data from 2014.

According to data released by the National Statistics Office (NSO), deflation in food items was 3.91% in November against 5.02% in October.

The rise in headline and food inflation during November 2025 is mainly attributed to an increase in inflation of vegetables, eggs, meat and fish, spices, fuel and light, the NSO said.

Fuel and light inflation for November was 2.32% against 1.98% in October 2025.

ICRA Chief Economist Aditi Nayar said a continued base-normalisation and the hardening in prices of some vegetables could make the headline CPI inflation cross 1.5% in the next print, which will be the last before the next MPC.

"The evolving inflation-growth outlook, as well as the fiscal policy measures unveiled by the next Union Budget, will guide the MPC's next decision. Our base case suggests a pause in the MPC's February 2026 policy," Nayar said.

PHDCCI CEO & Secretary General Ranjeet Mehta said, "Over the next two quarters, we anticipate that India's inflation will stay within a manageable range on the back of benign food prices, GST rates rationalisation, reasonable energy prices, and Reserve Bank of India's strategic monetary management."

Kotak Mahindra Bank Chief Economist Upasna Bhardwaj said, "While the inflation trajectory is expected to move upward from here on, we see the trajectory fairly benign until 1HFY27."

"Going ahead, with RBI having kept additional actions data-dependent, we see some room for a 25 bps repo rate cut. However, the rate-cutting cycle is clearly nearing the end, followed by a prolonged pause," Bhardwaj added.

Low inflation in the current fiscal year has given room to the RBI to cut policy interest rates by 1.25 percentage points. The Reserve Bank, earlier this month, significantly lowered the inflation projection for the current fiscal to 2% from 2.6% estimated earlier, as the economy continues to witness rapid disinflation.

The RBI had cut key policy interest rates by 25 bps to 5.25%, saying that the Indian economy is in a "rare Goldilocks period" marked by high growth and low inflation.

The Reserve Bank last week raised the FY26 GDP growth projection to 7.3%, from its earlier estimate of 6.8%. India recorded an 8% growth in the September quarter, and 7.8% in the June quarter.