While the month-on-month (MoM) food prices registered an uptick, food inflation is still expected to have remained negative last month
As food prices strengthened across most segments of the food inflation basket, India’s consumer price index (CPI)-based inflation is expected to have inched up to 1.66 per cent in December 2025 from 0.71 per cent in November 2025, as per a report.
A report attributed to Union Bank of India (UBI) noted that the inflation likely marked a spike but remained much lower than the 5.2 per cent rate recorded in the same period a year ago. As gold prices resumed their rally through December, the core inflation is expected to have inched up to 4.68 per cent during the month.
While the month-on-month (MoM) food prices registered an uptick, food inflation is still expected to have remained negative last month. The report pointed out that food CPI is likely to print at -1.19 per cent in December, adding that the highest price gain was witnessed in tomatoes.
Earlier, the Reserve Bank of India (RBI) Governor Sanjay Malhotra considered the benign inflation outlook, headline as well as core, to vote for a 25 basis point cut at the December Monetary Policy Committee (MPC) meeting, the minutes of MPC revealed.
“Demand pressures, as evident from low core inflation (excluding precious metals), are minimal and projected to remain low in the next three quarters. Considering the benign inflation outlook, headline as well as core, real interest rates need to be lower. Therefore, I vote for a 25-bps rate cut,” the Governor noted.
Malhotra also highlighted that he was in favour of retaining the neutral stance which gives the requisite flexibility to remain data-dependent and act according to the evolving macroeconomic conditions and outlook. Receding inflation pressures, although above targets in some advanced economies, open up the scope for more accommodative policies in the ensuing month, he added.
