A Reuters poll of 42 economists estimates that India’s Consumer Price Index (CPI) inflation fell to a multi-year low of just 0.48% in October 2025. This sharp deceleration marks the lowest level in over a decade and signals a successful and rapid moderation of price pressures across the economy. The primary drivers behind this collapse were a significant fall in food prices, particularly for vegetables, and the favorable impact of a high statistical base from the corresponding period last year when inflation surged.
The disinflationary trend was also aided by fiscal and policy measures, including the recent Goods and Services Tax (GST) reduction on select essential items, which contributed to lower input costs for businesses. Furthermore, the report indicates that core inflation, which strips out the volatile food and fuel components, likely eased to around 4.3%. The continued softening of core inflation, which is closer to the Reserve Bank of India’s (RBI) comfort zone, is a key positive indicator of underlying price stability.This low inflation figure carries significant macroeconomic implications. It provides the RBI with substantial monetary policy maneuverability, giving the central bank room to potentially consider interest rate cuts earlier than expected to stimulate growth, should global conditions permit. Critically, low inflation supports real income growth for households, increasing purchasing power and potentially spurring greater consumer consumption and investment heading into 2026.
