Two years in a row could see a decrease in inflation. The Centre for Monitoring Indian Economy (CMIE) has estimated that inflation will likely decrease from 5.4% in the financial year 2023–24 to 4.3% in the financial year 2024–25.
This is less than the Reserve Bank of India's (RBI) forecast of 4.5% for the consumer price index (CPI) for the upcoming fiscal year. The inflation rate rose 6.7% in the fiscal year 2022–2023—the highest level seen in nine years, including the fiscal year 2014–2015. In January of this year, the rate of inflation dropped from 5.7% in December 2023 to 5.1%. The financial year 2023–24 is expected to have the lowest annual inflation rate since the epidemic started, with a forecast of 5.4%.
An organization note dated March 1 states that a crucial aspect is lower food inflation with no disruptions in the supply of vegetables like potatoes, onions, and tomatoes.
According to CMIE predictions, food and beverage inflation will be 3.4% in the fiscal year 2024–2025 as opposed to 7.1% in the fiscal year 2023–2024 and 6.7% in the fiscal year 2022–2023. The inflation rate for apparel and footwear will be 4.1%, which is less than the 4.8% inflation rate for the fiscal year 2023–2024. At 9.5%, it reached its highest level in ten years in the fiscal year 2022–2023.
There are certain parts that could defy the pattern. Housing expenses are predicted by the CMIE to rise, with an inflation rate of 4.5% expected in the fiscal year 2024–2025. This represents the greatest level since the 2019–20 fiscal year. Of all the components, the components with the most inflation rate increases will be tobacco, alcohol, and pan, which will rise to 4.7% from 3.9% in the fiscal year 2023–2024. In the fiscal year 2022–2023 it was 2.2%.
Because of the increase in the cost of components in the miscellaneous group, the think tank projects that core inflation (apart from food, fuel, and light) would rise to 5% in the fiscal year 2024–25 from approximately 4.5% in the fiscal year 2023–24.
Home goods and services, health, transportation and communication, entertainment and recreation, education, and personal care and effects are all included in this area. Items in the miscellaneous group will see a 5.5% inflation rate in the fiscal year 2024–2025 compared to a 4.6% inflation rate anticipated in the fiscal year 2023–2024. In the 2022–2023 fiscal year, it was 6.3%.
