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📊 CPI WATCH: INDIA IN FOCUS | DECEMBER 2025
India’s inflation story in 2025 has been anything but normal — and the data is turning heads across rates, currencies, and risk assets.
This isn’t just a CPI print…
It’s a macro signal.
🔥 1️⃣ CPI TRENDS — HISTORIC CALM
India’s retail inflation (CPI) has remained exceptionally low throughout 2025, with several reports showing inflation below 2%, outside the RBI’s traditional 2–6% comfort band.
📉 Some monthly readings even fell toward record lows, with October 2025 reported near 0.25%, before a modest uptick afterward.
What’s driving this softness?
• Subdued food prices
• Stable energy costs
• Muted demand pressures
In short: price pressure is missing.
🏦 2️⃣ MONETARY POLICY — RBI HAS ROOM
With inflation this soft, the Reserve Bank of India has had room to support growth.
A rate cut in December 2025 highlighted that flexibility.
But here’s the twist 👇
Low inflation is helpful… until it isn’t.
If CPI stays below target for too long:
⚠️ Consumption can weaken
⚠️ Wage growth may stall
⚠️ Investment appetite could cool
This puts RBI in a delicate balancing act.
📊 3️⃣ CPI IS MORE THAN A NUMBER
CPI isn’t just inflation — it’s a cost-of-living scoreboard.
In India, CPI heavily weights:
🥗 Food
🏠 Housing
🚗 Transport
That’s why CPI directly influences:
• Interest rate decisions
• Wage adjustments
• Currency perception in global markets
Markets don’t just react — they reprice expectations.
🔮 4️⃣ STRUCTURAL SHIFTS AHEAD
Looking forward, India is preparing for:
🔄 CPI methodology updates
📜 Inflation framework revisions by 2026
These changes could reshape how inflation is measured — and how policy decisions are interpreted going forward.$BNB $XRP $ETH
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