Retail inflation fell to an eight-year low of 1.54% in September 2025. Previously, it was at this level in June 2017. This is due to a decline in the prices of some food items. Retail inflation was 2.07% in August.
The government released the official retail inflation figures today, October 13th. The Reserve Bank of India (RBI) aims to keep inflation within a range of 4% ± 2%.
Food prices decreased in September
Food items contribute approximately 50% of the inflation basket. Month-on-month inflation decreased from minus 0.64% to minus 2.28%.
Rural inflation decreased from 1.69% to 1.07% in September. Urban inflation decreased from 2.47% to 2.04%.
How does inflation fluctuate?
The rise and fall of inflation depends on the demand and supply of products. If people have more money, they will buy more things. Buying more things will increase the demand for goods, and if the supply does not meet the demand, the prices of these goods will increase.
This way, the market becomes vulnerable to inflation. Simply put, excessive flow of money in the market or shortage of goods causes inflation. However, if demand is low and supply is high, inflation will decrease.
