ECONOMY
June retail inflation slows down to a six-year low of 2.10% as food prices drop
- IBJ Bureau
- Jul 15, 2025
Annual retail inflation slowed to a more than six-year low of 2.10 per cent in June. The inflation, measured by the Consumer Price Index (CPI) was near the lower range of the central bank’s tolerance band, as food prices continued to ease. This makes a case for further interest rate cuts.
Retail inflation was at 2.82 per cent in May. Food prices have been the main driver for slowing inflation this year, as adequate rainfall boosted output of agricultural goods.
Inflation in food items – which account for nearly half of the CPI index – fell by 1.06 per cent in June from a 0.99 per cent rise in the previous month. Vegetable prices fell by 19 per cent year-on-year, compared to a 13.7 per cent fall in May.
“CPI inflation edged further down in June on the back of lower food prices,” said Sakshi Gupta, an economist of HDFC Bank.
The headline and food inflation in June was the lowest since January, 2019, the government’s statistical department said in its release.
The Reserve Bank of India is mandated not to let inflation fall below 2 per cent or rise above 6 per cent for three consecutive quarters.
Prices of cereals rose by 3.73 per cent on-year against a 4.77 per cent increase in May, while those of pulses declined by 11.76 per cent compared to an 8.22 per cent fall in May.
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