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Retail Inflation at 1.33% in Dec, Stays Below RBI Target for 11 Months

India's retail inflation, measured by the Consumer Price Index, rose to 1.33% year-on-year in December 2025. This marks the eleventh consecutive month it has remained below the Reserve Bank of India's medium-term target of 4%. While overall inflation increased, food prices continued to deflate, registering at -2.71%. The data showed a sharper rise in urban inflation compared to rural, with moderation noted in categories like fuel, housing, health, and education.

Key Points: Dec 2025 Retail Inflation 1.33%, Below RBI's 4% Target

  • Headline CPI at 1.33% in Dec 2025
  • Below RBI's 4% target for 11 months
  • Food inflation in deflation at -2.71%
  • Urban inflation (2.03%) outpaces rural (0.76%)
  • Core categories like health and education see moderation
1 min read

Retail inflation stands at 1.33% in December, remains below RBI's medium-term target

India's CPI inflation rises to 1.33% in Dec 2025, staying under RBI's 4% target. Food deflation persists at -2.71%. Urban inflation outpaces rural.

"Inflation remained below the Reserve Bank of India's medium-term target of 4% for the 11th straight month. - Ministry of Statistics"

New Delhi, January 12

The year-on-year inflation based on Consumer Price Index for December, 2025 stands at 1.33% over December, 2024 mainly attributed to increase in inflation of Personal care and effects, Vegetables, Meat and fish, Egg, Spices and Pulses and Products, Ministry of Statistics & Programme Implementation data said on Monday.

Headline inflation in December 2025 increased by 62 basis points relative to November 2025.

Inflation remained below the Reserve Bank of India's medium-term target of 4% for the 11th straight month.

The year-on-year food inflation for December is -2.71% (Provisional). The corresponding inflation rates for rural and urban areas are- 3.08% and -2.09%, respectively.

Inflation rose across both rural and urban areas. Rural headline inflation increased to 0.76% in December from 0.10% in November, while urban inflation climbed more sharply to 2.03%, up from 1.40% a month earlier.

Housing inflation eased marginally to 2.86%, while education and health inflation were 3.32% and 3.43%, respectively, indicating slight moderation relative to November. Fuel and light inflation declined to 1.97%, and transport and communication inflation softened to 0.76%.

- ANI

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Reader Comments

R
Rohit P
This is positive news for the economy overall. Sub-4% inflation for almost a year gives RBI room to support growth. Hope this stability continues and translates into better interest rates for home loans.
A
Aman W
Urban inflation at 2% vs rural at 0.76%? This gap is worrying. It shows the cost of living in cities is rising much faster. As a middle-class professional in Bangalore, I feel this pinch daily – rent, transport, everything is up.
S
Sarah B
Interesting to see food inflation is negative overall (-2.71%), but the article says vegetables and pulses contributed to the increase? Seems contradictory. Can someone explain how that works?
V
Vikram M
The moderation in fuel and light inflation is a relief. Petrol prices have been stable lately. This helps everyone, from auto drivers to logistics companies. Hope the trend holds. 👍
N
Nikhil C
While the overall number is low, health inflation at 3.43% and education at 3.32% are still above the RBI target. School fees and hospital bills are major expenses for families. The government should focus on controlling these.

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