Retail inflation in India cooled to 1.33 percent for December, down from 1.67 percent in November, as per the latest Ministry of Statistics data. This subdued rate comes against a backdrop of robust economic growth and favorable base effects.
A key highlight is the persistent deflation in the food segment, clocking in at -1.53 percent for the seventh straight month. This is largely attributed to bumper vegetable production, with prices tumbling 16.85 percent year-on-year. Pulses (-2.28 percent) and fruits (-1.40 percent) also contributed to the softening.
Non-food categories showed mixed results: Fuel inflation turned positive at 0.21 percent after months of declines, while clothing and footwear edged up 2.54 percent. The rural-urban divide persisted, with villages at 1.01 percent versus 1.83 percent in cities.
For policymakers, this data reinforces a dovish stance at the RBI. Inflation comfortably below the 4 percent target midpoint allows focus on employment and investment revival. Analysts project January figures to remain tame, supported by seasonal arrivals.
Overall, the print reflects successful supply-side interventions and moderating input costs. As global commodity prices stabilize, India’s inflation outlook remains benign, fostering consumer confidence and spending momentum into the new year.