India’s Retail Inflation Eases but Picks Up Slightly in November 2025

India’s retail inflation (measured by the Consumer Price Index – CPI) recorded a marginal rise to 0.71% in November 2025, according to provisional data cited by Reuters. While this marks a slight uptick from previous months, the overall inflation level remains well within the Reserve Bank of India’s (RBI) target range of 2–6%, offering comfort to policymakers.

Food Inflation Softens

A key driver of the moderation was a cooling in food inflation, particularly in perishables and cereal prices. Vegetable supply normalization—following disruptions earlier in the year—helped soften pressures on household budgets. This easing offset mild increases in fuel and miscellaneous items.

Core Inflation Stable

Core inflation, which excludes volatile food and fuel prices, remained steady, signalling that underlying price pressures are broadly controlled. Stable core inflation often indicates that demand-side pressures are manageable and long-term inflation expectations remain anchored.

Policy & Economic Implications

For the RBI, the latest CPI reading serves as an important input ahead of monetary policy deliberations:

• Policy stability likely: With inflation well below the upper threshold, there is little pressure for immediate tightening.
• Consumer sentiment boost: Lower food inflation may support urban and rural consumption during the winter season.
• Monetary transmission: Banks may continue to maintain current lending rates unless external shocks emerge.

Why This Matters (UPSC Angle)

• Inflation trends influence interest rates, fiscal policy choices, growth projections, and rural welfare schemes.
• CPI is also important for understanding the inflation-targeting framework, anchored by the RBI Act amendments (2016).
• Candidates should link inflation data with global commodity trends, supply chain recovery, and domestic demand cycles.