India’s retail inflation eases to 3.16% in April from 3.34% in March

India’s retail inflation eased to 3.16 per cent in April from 3.34 per cent in March, driven by a further moderation in food prices. This marks the third consecutive month that inflation has remained below the Reserve Bank of India’s 4% medium-term target.

A Reuters poll of 43 economists suggested inflation fell to 3.27% in April.

Intense heatwaves this summer did little to affect a robust harvest, offering much-needed relief to many Indian households which allocate a significant portion of their budgets to food.

Food prices account for nearly half of the consumer price basket.

“The fact is we are in April, and you’re entering the summer months. The expectation is that seasonally you should see a pick-up in vegetable prices, but for now we’re not seeing that,” Gaura Sengupta, chief economist at IDFC First Bank told Reuters.

Kitchen staples

Early predictions of above-average monsoon rains this year have raised expectations of stronger agricultural output and higher rural demand in a largely agriculture-dependent economy.

Wholesale price index-based inflation is expected to have eased to 1.76% last month, down from 2.05% in March, the survey also showed.

More room for RBI rate cuts

With inflation predicted to stay subdued, the RBI has more room to cut interest rates to support a slowing economy.

RBI Governor Sanjay Malhotra, while announcing the Monetary Policy Committee’s decision last month, said that inflation has been on a downward trend, supported by a favourable outlook on food prices.

He noted that inflation is expected to ease further in FY26, potentially offering relief to households grappling with cost pressures. However, the central bank cautioned that it remains alert of global uncertainties.