India’s government issued data on April 15 showing that wholesale inflation decreased to 2.05 percent in March from 2.4 percent in February. While the food index saw a further fall, the prices of manufacturing items, which make up about two-thirds of the index, increased by 3.1 percent from 2.9 percent the previous month.
The central bank dropped interest rates by 25 basis points for the second time in a row in its April meeting, partly due to falling inflation and the possibility of slowing GDP. Initially set at 6.5 percent at the beginning of the year, the policy rate is currently at 6 percent.
The Reserve Bank of India reduced its forecast for inflation to 4 percent from 4.2 percent in February and India’s growth estimate to 6.5 percent for FY26 from 6.7 percent previously.
Additionally, according to the Ministry of Commerce & Industry’s announcement, food article inflation decreased dramatically from 3.38 percent in February to 1.57% in March. The major article inflation rate decreased from 2.81 percent to 0.76 percent in the preceding month. In March, gasoline and power inflation was 0.20 percent, whereas in February, it was -0.71 percent. In March, the inflation rate for manufactured goods was 3.07 percent.
ICRA further stated that it is anticipated that headline WPI inflation will drop even more, to approximately 1.4–1.6 percent in April 2025 (+1.2 percent in April 2024).
