Inflation in India decreases in the third month in a row, making the issue for more price cuts

The main inflation in India decreased on an annual basis for a third month in a row to 4.31 % in January, providing more cash dilution space after lowering the prices of the central bank in the country for the first time In nearly five years last week.

The reading of January was the lowest rate since August 2024, and it issued less than expectations by 4.6 % of the Reuters economists.

While prices were cooled in all fields, food prices were dramatically decreased from 7.69 % in December to 5.68 % in January. The annual price growth of vegetables witnessed the largest decrease from 26.56 % in December to 11.35 % in January.

“She looks forward to the future, good soil conditions, healthy tank levels and a high rule means that we expect food enlargement to continue to slow down in the coming months,” said Harry Chambers, an economist in economics consulting in the economy. “With the economy in a softer area, the basic price pressures must remain under examination.”

Low inflation may clarify the road to reduce another rate by the Indian Reserve Bank, which reduced the ribau rate to 6.25 % from 6.5 % on Friday in an attempt to increase the slow economy.

RBI is currently facing a dilemma as it seeks to support growth in the third largest economy in Asia, but the price cuts aimed at stimulating growth can weaken rupees, which reached a record level earlier this month and was under pressure due to the strongest dollar.

However, the Indian currency has been strengthened during the past two days, according to what was reported Due to intervention By the central bank.

” In his statement The decision to reduce prices was due to decrease inflation, which is expected to moderate in 2025 and 2026 to achieve the bank’s 4 % goal.

The entire year growth for the fiscal year ended in March 2025 It is expected to come 6.4 %, according to government estimates, sharply less than 8.2 % in the previous year. RBI also reduced its growth expectations for the current fiscal year to 6.4 % – identical to the government’s expectations. The bank had linked growth by 6.6 % in its previous appreciation.

The central bank said on Friday, “The dynamics of inflation in this growth opens the policy space for the Monetary Policy Committee (Monetary Policy Committee) to support growth, with a focus on align inflation with the goal,” the central bank said on Friday.