New Delhi, Oct 14 – According to the latest State Bank of India (SBI) analysis, India’s consumer price inflation is expected to dip to about 0.45 percent next month. The report argues this slow roll‑out of inflation gives the RBI a clear signal that it should act decisively, rather than waiting for murmurs in the markets.
SBI’s Group Chief Economic Advisor, Dr Soumya Kanti Ghosh, said the Reserve Bank’s primary task is to hit its inflation target, but the bank is at risk of missing the mark if it stays glued to market noise. “When inflation has already slowed, holding back on policy moves may drag the RBI behind the curve,” Ghosh cautioned. “It’s safer to err on the side of a rate cut than to keep the policy too tight.”
The RBI’s newest forecast places last‑year inflation at 3.7 percent, a clear drop from the 4.4 percent seen in earlier estimates. However, the SBI report predicts average CPI inflation for fiscal 2026 will sit near 2.2 percent—well below the RBI’s 2.6 percent projection.
In September, India’s CPI fell to a 99‑month low of 1.54 percent, mainly because food and beverage prices cooled. The decrease in food inflation has now stretched to 11 straight months, the longest run in the current CPI series. Vegetables and pulses remain on a downward trend, while spices also dropped in September. Fruits and oil‑fat sectors saw smaller but still noticeable falls. On the flip side, personal‑care goods, gold, and housing costs ticked up slightly.
The analysis points to a strong summer sowing season—particularly rice, maize, urad, and sugarcane—keeping staple prices low, though heavy rains after the monsoon could bring fresh disruptions. Both urban and rural areas have enjoyed a steady easing in prices since October.
With CPI easing and a clear case for a rate cut, SBI’s report suggests that forwards‑looking policymakers should listen to these signals and adjust the policy mix accordingly. The coming months will test whether the RBI follows suit.
Source: ianslive
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