In Brief
Significant impact of GST reduction
Inflation only 0.25% in October 2025
Vegetables, fruits, eggs cheaper; gold and oil expensive
Information about retail inflation for the month of October 2025 has been released. Retail inflation is at its lowest in many years. As a result, food grain prices have fallen while oil has become more expensive. This has happened for the first time in 10 years, causing gold and personal care items to become more expensive. This has provided relief to the middle class, and the reduction in 'GST' has shown a positive impact.
By studying the Goods and Services Tax and reducing the GST on retail items, it appears that the benefit has been more for the middle-class people. Retail inflation reached a record low in October, with a recorded rate of 0.25 percent. The reduction of GST on as many as 380 items and the simultaneous drop in vegetable prices brought down retail inflation. This data was released by the National Statistics Office on Wednesday.
In 2012, the retail inflation for October was measured based on the Consumer Price Index with this as the base year. A record of 1.44 percent retail inflation for September was noted. However, in October 2024, retail inflation was recorded at a substantial 6.21 percent. Due to the decline in prices of oil, vegetables, footwear, fruits, and various products, as well as transportation and telecommunication services, there was a decrease in inflation for October. Additionally, changes made by the central government in GST from September 22 also contributed to this benefit. The Central Statistics Office, while extracting related information, reviewed 1,181 villages and 1,114 cities across the country to calculate the percentage of retail inflation.
Although retail inflation has decreased in some parts of India, the situation remains unchanged in some states. Kerala has the highest retail inflation in the country at about 8.56 percent, followed by Jammu and Kashmir at 2.95 percent. Karnataka, Punjab, and Tamil Nadu have inflation rates of 2.34 percent, 1.81 percent, and 1.29 percent, respectively.
Meanwhile, stable inflation has been recorded in the states of Uttar Pradesh, Chhattisgarh, Assam, Delhi, and Bihar. Aditi Nayar, the chief economist at 'ICRA', has indicated that the Reserve Bank may reduce inflation for the entire current financial year from 2.6 percent. Similarly, due to the current inflation figures, there is a possibility of a quarter percent cut in the repo rate in the monetary policy review to be announced in December. Such possibilities are also being speculated.