India's Retail Inflation Hits Historic Low! CPI Inflation At 0.25% In Oct, Food Prices At -5%

India's CPI Inflation Data: India's retail inflation tumbled to a record low of 0.25% in October 2025 (on a year-on-year basis) due to negative food costs and the Goods and Services Tax (GST) revision, as per the data released by the Ministry of Statistics and Programme Implementation on Wednesday, November 12.

India's Consumer Price Index (CPI) inflation data dropped to a multi-year low as the food inflation dipped further to -0.5% in October. "There is decrease of 119 basis points in headline inflation of October, 2025 in comparison to September, 2025. It is the lowest year-on-year inflation of the current CPI series," as per MOSPI press release.

Decline In Food Inflation

The gap between headline and food inflation widened sharply in October 2025, as food prices saw a steep decline during the month. Consumer Food Price Index (CFPI) stood at -5.02% in October against -2.33% in September this year. Whereas, food inflation in October 2024 stood at 6.21%.

What Led To Decline In Food Prices In October?

The major reason behind the decline in food prices in October was the revised GST rates, favourable base effect and drop in inflation of oils and fats, vegetables, fruits, egg, footwear, cereals and products, transport and communication, etc.

Rural, Urban, Housing Inflation

Headline and food inflation alsi remained in negative in rural, hurban and housing area. The headline inflation stood at -0.25% in October against -1.07% in September, 2025. Whereas, the CFPI inflation dipped further to -4.85% in October against -2.22% in September, 2025.

Headline inflation in urban sector fell to 0.88% in October grom 1.83% in September. The year-on-year housing inflation rate for October month stood at 2.96%.

India's Low Retail Inflation Raises Hope Of Rate Cut

Decline in Inflation in October has raised the possibility of another rate cut by the RBI in October. The decline in retail inflation in October was the result of the market absorbing the impact of the 100 bps rate cut announced by the RBI since the beginning of 2025. Additionally, the reduction in GST rates, favourable base effect and food deflation emerged as the major contributor in declining retail inflation.

"Two factors will guide the further decline in CPI inflation - continued softening of food prices and the impact of GST rate reductions. October marks the first full month reflecting the revised, lower GST rates on mass consumption goods," stated Dipti Deshpande, Principal Economist, Crisil Ltd earlier.

India's September Inflation

Easing food prices dragged India's retail inflation to a multi-year low of 1.54% in September. The significant decline in retail inflation in September and October has raised expectations of another repo rate cut in December.

Retail inflation was about 2.07% in August and around 2% in July. The stellar gold price rally continued to impact the core inflation. Headline inflation in September stood at 1.54%, the lowest since June 2017. At the same time, food inflation remained negative for the fourth consecutive month in September.

In September, the rural inflation declined significantly to 1.07% in September compared to 1.69% recorded in August. Food inflation in the rural sector remained in negative territory at -2.17% in September, compared to -0.7% recorded in August this year. Urban inflation also saw a reduction, dropping to 2.04% in September, from 2.47% recorded in August 2025. Just like rural food inflation, costs of vegetables and other edible items declined in September.