What is India's current inflation rate?

India's inflation rate in October 2025 was 0.25%, the lowest since 2013.

How has the GST rationalisation in India affected inflation?

The GST rationalisation in September 2025, which did away with the 12% and 28% tax slabs, has helped ease inflation in India, particularly in categories like milk and milk products, non-alcoholic beverages, and prepared meals, snacks and sweets.

What is the outlook for India's inflation in the current fiscal year?

Experts predict that India's CPI inflation will average 2.5% in the 2025-26 fiscal year, significantly lower than the previous year's 4.6%, due to factors like healthy food supplies, benign global crude oil prices, and the continued benefits of the GST rate cuts.

Home / Business and Economy / Inflation Plunges to Lowest Level in 12 Years, Raising Hopes for RBI Rate Cut

Inflation Plunges to Lowest Level in 12 Years, Raising Hopes for RBI Rate Cut

16 Nov

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Summary

Inflation in India drops to 0.25% in October 2025, lowest since 2013
Falling food prices and GST rationalisation drive the decline
Experts predict CPI inflation to average 2.5% in fiscal 2025-26

Inflation Plunges to Lowest Level in 12 Years, Raising Hopes for RBI Rate Cut

In a significant development, India's inflation rate in October 2025 has plunged to 0.25%, the lowest level since the current data series began in 2013. This sharp decline has raised hopes of an interest rate cut by the Reserve Bank of India (RBI) in its upcoming monetary policy review.

The drop in inflation was primarily driven by lower food prices as well as the impact of the government's recent rationalisation of Goods and Services Tax (GST) slabs. Inflation was already low at 1.4% in September 2025 due to falling food prices, and this trend continued in October. The food index, in particular, recorded a deflation of 5%.

Experts believe the low inflation environment will persist. Research firm Crisil expects CPI inflation to average just 2.5% in the current fiscal year, significantly lower than the 4.6% recorded in the previous year. This is attributed to factors such as healthy food supplies, benign global crude oil prices, and the continued benefits of the GST rate cuts on mass consumption items.