Wednesday, October 28, 2026

RBI January Bulletin projects GDP growth pickup, cautions on food inflation

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The Reserve Bank of India (RBI) in its January 2025 Bulletin highlighted key trends in the economy, noting a “quickening of high-frequency indicators of economic activity” in the second half of FY25. The bulletin projects an implicit pickup in real GDP growth based on the National Statistical Office’s first advance estimates for FY25.

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India’s headline inflation eased for the second consecutive month in December, falling to a four-month low of 5.22% from 5.48% in November.

Food inflation dipped to 7.7% from 8.2%, with decelerations observed in cereals, milk, vegetables, pulses, and sugar. However, inflation for meat, fish, eggs, fruits, and edible oils hardened. Core inflation remained steady at 3.7%.

“Headline inflation eased for the second successive month in December, although the stickiness in food inflation warrants careful monitoring of second-order effects,” the RBI said, cautioning that firming rural wages and corporate salary growth could amplify inflationary pressures.

High-frequency food price data for January so far indicate further moderation in rice prices and sharp corrections in vegetable prices, particularly potatoes, onions, and tomatoes. However, wheat and edible oil prices continue to edge higher.

Also read: RBI takes steps to boost rupee in global trade, allows banks to open INR A/Cs overseas for NRIs

The bulletin also provided a global perspective, noting some economic slowdown in the US, weak to modest recoveries in Europe and Japan, and moderate growth in emerging markets.

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