Overview
- October CPI fell to 0.25%, the lowest since the series began, driven by steep deflation in vegetables and pulses and the pricing effects of September’s GST rationalisation and base factors.
- Core inflation held near 4.4% and gold prices jumped, signaling that disinflation is concentrated in food and not yet broad-based across the basket.
- Wholesale prices also turned negative at -1.2% in October, and several economists now see full-year inflation near 2–2.2% versus the RBI’s 2.6% projection.
- Forecasting misses have put the RBI’s model under scrutiny, with critics warning that overestimation has kept real rates tighter than intended.
- Analysts say the odds of a December rate cut have increased, though strong Q2 growth around 7% and external pressures on exports, including US tariffs, complicate the decision.