Quote on CPI numbers by Mahendra Patil, Founder and Managing Partner, MP Financial Advisory Services LLP
Below The Quote on CPI numbers by Mahendra Patil, Founder and Managing Partner, MP Financial Advisory Services LLP
“The sharp moderation in India’s retail inflation to 3.16% in April 2025, the lowest since July 2019, is a significant tailwind for the economy. The decline was led by easing food prices, with food inflation falling to just 1.78%, aided by a broad-based correction in vegetables, pulses, and spices. This disinflationary trend provides the Reserve Bank of India with a compelling case to continue monetary easing, potentially with a 25 basis point rate cut in the June policy. The inflation trajectory appears well-anchored, with rural inflation at 2.92% and urban at 3.36%.
However, some upward pressures remain in core categories such as healthcare (4.25%), education (4.13%), and notably, fuel and light inflation, which rose to 2.92% from 1.42% in March. This increase, despite declining global crude oil prices, reflects higher domestic LPG and electricity tariffs rather than pump fuel costs. As global commodity prices remain benign and the rupee stable, the current environment presents a valuable opportunity to stimulate demand and ease borrowing costs.
In the context of renewed global tariff threats and trade realignments, a rate cut would not only support domestic consumption but also reduce the cost of capital for Indian corporates, enhancing their competitiveness in both domestic and export markets. Nonetheless, a data-driven and calibrated policy approach remains critical to address sector-specific price rigidities and ensure a broad-based and durable recovery.”
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