Key Highlights
- Overall CPI slipped to 3.61% YoY in February 2025, a 65‑basis‑point fall from the previous month and the weakest pace since July 2024.
- Food price inflation eased to 3.75% YoY, with rural food prices falling 4.06% and urban food prices 3.20%.
- Rural CPI registered 3.79% versus 3.32% in urban areas, both marking month‑on‑month declines.
- Housing costs nudged up to 2.91%, while fuel and light continued to decline, registering -1.33%.
- Vegetables, eggs, meat, pulses and dairy products were the primary contributors to the overall slowdown.
Detailed Insights
The Ministry of Statistics and Programme Implementation (MoSPI) released provisional CPI figures for February 2025, confirming a broad‑based deceleration in price pressures. The headline index, anchored on consumer expenditures, dipped to 3.61% year‑on‑year, carving out the lowest inflationary reading since the July 2024 cycle.
Food inflation, measured by the Consumer Food Price Index (CFPI), contracted sharply to 3.75% YoY. Rural food inflation fell to 4.06% and urban food inflation to 3.20%, representing a 222‑basis‑point swing from January 2025 – the most pronounced drop in the series since May 2023.
Geographically, rural CPI registered a 3.79% rise, down from 4.59% in January, while urban CPI eased to 3.32% from 3.87%. Sector‑specific analysis reveals mixed movements: housing prices edged higher (2.91% from 2.82%), fuel and light continued to decline (-1.33% from -1.49%), education remained static at 3.83%, health costs rose modestly to 4.12%, and transport & communication climbed to 2.87%.
Price declines in staple commodities—vegetables, eggs, meat & fish, pulses, and dairy—served as the engine of the overall slowdown. Conversely, commodity‑specific inflation remained elevated for coconut oil (54.48%), coconut (41.61%), gold (35.56%) and silver (30.89%). The most deflationary items were ginger (-35.81%), jeera (-28.77%), tomato (-28.51%), cauliflower (-21.19%) and garlic (-20.32%).
Data were collated from 1,114 urban markets and 1,181 villages nationwide, achieving complete coverage of villages (100%) and 98.6% coverage of urban outlets.
Key Concepts
- CPI (Consumer Price Index): A statistical measure that tracks changes in the price level of a basket of consumer goods and services over time.
- CFPI (Consumer Food Price Index): A subset of the CPI focusing exclusively on food items, used to gauge food‑price inflation.
- Basis Point: One hundredth of a percentage point (0.01%). Used to express small changes in interest rates or inflation.
- Provincial vs Urban Reporting Coverage: The proportion of villages and urban markets that submit price data to MoSPI, influencing the reliability of the index.
- Deflationary Driver: Any factor—typically a fall in commodity prices—that contributes to a reduction in overall inflation.