Overview

• BoB’s research trims its headline CPI forecast to 3.1% from 3.5% on an estimated 55–75 bps disinflation from the new rates.
• The bank expects a ₹70,000 crore to ₹1 lakh crore boost to private consumption, or 0.2–0.3% of GDP.
• About 99% of items fall into 0%, 5% or 18% brackets, lowering effective rates to roughly 10–11% and expanding the taxable consumption base to ₹150–160 lakh crore.
• Food inflation could ease by 25–35 bps over six months while core inflation may fall 30–40 bps due to cheaper household essentials and medicines.
• The government pegs the revenue impact at about ₹48,000 crore, while BoB says lower prices should support non‑durables output, credit demand, and IIP growth.