Story perspectives

India's Inflation Rises to 0.71% Amid Food Price Declines

12/12/2025

Summary

Story summary

India’s retail inflation rose to 0.71% in November 2025 from 0.25% in October.
The uptick came as food-price declines slowed, with vegetables down 22.2%.
The Reserve Bank of India (RBI) cut rates by 25 basis points and signaled further cuts if growth slows after the festive season.
The RBI projects inflation at 2.9% and will introduce a new consumer price index in February 2026, which will adjust food weights.

History

Historical Context

The 1991 Indian economic crisis stemmed from a severe balance of payments deficit, exacerbated by rising oil prices during the Gulf War and dwindling foreign reserves. In response, Prime Minister P. V. Narasimha Rao and Finance Minister Manmohan Singh initiated sweeping economic reforms, liberalizing the economy and attracting foreign investment. These changes have significantly shaped India's economic landscape, with GDP growing from $266 billion in 1991 to $4.18 trillion by 2025.

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Story summary

India’s retail inflation rose to 0.71% in November 2025 from 0.25% in October.
The uptick came as food-price declines slowed, with vegetables down 22.2%.
The Reserve Bank of India (RBI) cut rates by 25 basis points and signaled further cuts if growth slows after the festive season.
The RBI projects inflation at 2.9% and will introduce a new consumer price index in February 2026, which will adjust food weights.

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