RBI Bulletin: CPI Inflation Falls on Food Price Drop and GST Cuts

Inside the announcement  
The RBI’s bulletin noted that food inflation contracted significantly, pulling down headline CPI. GST rate cuts across clothing, transport, and medical care further reduced core inflation pressures. Analysts caution that while the near-zero inflation print is positive for consumers, policymakers must assess whether this is a structural trend or a temporary reprieve. The RBI’s Monetary Policy Committee is expected to monitor upcoming data closely before adjusting policy rates.  

Notable updates  
• CPI inflation fell to 0.25% in October 2025, down from 1.54% in September  
• Food inflation contracted to -5.02%, sharply reducing headline inflation  
• GST rate cuts in clothing, transport, and medical care eased core inflation  
• Favourable base effects amplified the decline in CPI  
• RBI bulletin signals cautious optimism but warns of global uncertainties  

Major takeaway  
The fall in CPI inflation underscores the combined impact of food price corrections, GST rationalisation, and base effects. While the trend provides short-term relief, its durability will hinge on supply-side resilience and external economic factors.  

Sources: RBI Bulletin, Economic Times, Financial Express, Indian Express