Overview

• Official CPI data show headline inflation at 1.54% in September, down from 2.07% in August and below the RBI’s 2%–6% band for the second time in three months.
• Food inflation fell 2.28% year on year, with vegetable prices down about 21.4%, marking a fourth consecutive month of negative food readings.
• Inflation eased across regions, with rural headline inflation at 1.07% and urban at 2.04%, reflecting broad-based disinflation.
• The RBI kept rates unchanged in October, lowered its FY26 inflation forecast to 2.6% with quarter-wise projections, and indicated scope for a rate cut that markets see as possible in December.
• Price trends were uneven across categories and states, as housing inflation rose to 3.98% while fuel and transport cooled, and some states such as Kerala and Jammu & Kashmir recorded higher readings.