A sharp decline in food inflation is also expected.
Retail inflation in India is expected to decline further in October 2025. According to a report by Union Bank of India, this decline may be due to seasonal delay in food prices and the full impact of the recently implemented GST reforms. The report says that only a slight increase in prices will be seen in the coming months.
According to the report, our estimated rate of Consumer Price Index (CPI) for the month of October is currently less than 0.50%. Food inflation is also expected to decline sharply and may remain in the negative zone during the winter months, as the impact of floods has now reduced.
Inflation at lowest level in 8 years
There has been a sharp decline in inflation and it has reached the lowest level in the last 8 years. The main reason for this is the reduction in food prices and improvement in GST rates. The CPI inflation estimate for the financial year 2025-26 has been reduced to 2.6%. Earlier it was 3.1%. It is estimated that inflation will remain below the target throughout the year and will increase slightly only in the last quarter.
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Inflation also decreased in September
The figures for the month of September also showed a clear decline in retail inflation (CPI) as compared to last time, which proves that there has been an overall relief in prices. The Consumer Food Price Index (CFPI) stood at -2.28%, which means that the prices of food items have been continuously decreasing since June 2025.
Inflation decreased in rural areas
According to the data, the inflation rate in rural areas was 1.07%, while in urban areas it was recorded at 2.04%. Food inflation remained negative at both the places. 2.17% in rural, and -2.47% in urban, which shows falling prices of vegetables and edible oil. The government cited the reason for this decline as favorable base effect and decline in prices of major commodities like vegetables, oil-ghee, fruits, grains, pulses, eggs and fuel.