Consumer inflation in country to stay low at 0.4% in Oct-Dec quarter, lower than RBI’s projection: BoB
The report stated that inflation this quarter is likely to be 0.4 percent, which is below the 0.6 percent estimated by the Reserve Bank of India (RBI). The main reason for this is the decrease in the prices of food items.
The statement said, “We expect PPI to settle at 0.4 percent in the third quarter, slightly below the RBI’s forecast of 0.6 percent.
The report stated that the BoB internal indicator called the Economic Conditions Indicator (ECI) was at -2.8 percent for the first 11 days of December 2025. This suggests that price pressure is weak and inflation is under control.
According to the report, the main reason for the low general inflation, also called headline inflation, is the decrease in food prices. Vegetables such as tomatoes, onions and potatoes have become cheaper.
The report stated that although tomato prices have started to increase slightly, this is not a major concern. There is adequate supply of vegetables in the markets, as mandi arrival data shows.
Generally speaking, prices of tomatoes, onions and potatoes continue to fall rapidly. This helps keep food prices low. The report also stated that inflation will ease somewhat in November 2025 due to low food prices. There was a slight increase in vegetable prices compared to the previous month, but this is normal. The harvest season generally helps lower prices and market supply data remains positive.
In addition to food, the report also examined other items such as household goods and services. It was stated that the prices of these products were mostly stable. One reason for this is the GST impact, which helps prevent prices from rising too much even during the festive season when people buy more things.
Bank of Baroda said its inflation forecast of 0.4 per cent in the third quarter was slightly below the RBI’s forecast of 0.6 per cent. The bank believes falling food prices will continue to keep inflation low for most of this financial year.
The report states that prices remain low because food is cheaper and in good supply. This is good news for people because it means daily expenses do not increase by much.
