Retail Inflation Hits 6-Year Low: What Falling Prices Mean for Your Wallet

In April 2025, retail inflation hit a 6-year low of 3.16%. This means that the prices of everyday things like vegetables, fruits, pulses, and other foods did not increase much. This is good news for many people as it helps them save more money when they buy groceries and daily items.

Retail inflation hits 6-year low because of cheaper food

The retail inflation hits 6-year low mainly because food prices have become cheaper. In March, inflation was 3.34%, and in April last year, it was 4.83%. But now, it has gone down a lot. The last time it was this low was in July 2019, when it was just 3.15%.

The National Statistics Office shared that food inflation dropped to 1.78% in April. This is the lowest since October 2021. Prices of some important food items like potatoes, tomatoes, pulses (like arhar), chicken, and spices like jeera all became cheaper in April.

This drop is helping families spend less on food and save money.

RBI may cut interest rates as retail inflation hits 6-year low

The Reserve Bank of India (RBI) tries to keep inflation around 4%. Since retail inflation hits 6-year low, RBI might reduce interest rates again in June 2025.

Earlier this year, RBI had already lowered the interest rates in February and April. If RBI cuts rates again, it will help people and businesses borrow money at lower costs. This helps the economy grow.

In villages, the inflation was 2.92% in April, which is less than March's 3.25%. In cities, it was 3.36% in April, a little less than March's 3.43%. This shows that prices are falling for both village and city people.

Among all the Indian states, Kerala had the highest inflation at 5.94%. The lowest inflation was in Telangana, at only 1.26%. In West Bengal, it was the same as the national rate — 3.16%.

Experts say that a good rabi (winter) harvest and strong pulses output helped bring food prices down. A good monsoon is also expected soon, which will help farmers grow more food.

But experts also warn that climate change is making the monsoon tricky. Sometimes there is too much rain, and other times, there is very little. These changes can affect farming and food prices.

Growth may come first as retail inflation hits 6-year low

Because retail inflation hits 6-year low, experts believe RBI will now focus more on helping the country grow. Lower inflation, falling crude oil prices, and good weather give RBI more confidence.

Experts also believe that in the next few months, inflation will stay below 4%. In fact, they think it could go down to around 3.5% in the full year of 2025-26. This gives RBI a chance to cut interest rates more — up to 75 basis points — which can make loans cheaper for homes, cars, and businesses.
The news that retail inflation hits 6-year low is good for all of us. It means food is cheaper, daily costs are down, and the RBI might reduce interest rates again. If the weather stays good and farming continues strong, prices will stay low, and people will be able to save more money.

This is a hopeful time for families, businesses, and the economy.