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Consumer inflation is expected to stay very low in the October to December period of the current financial year, FY26, according to a report by Bank of Baroda.
The report said inflation in this quarter is likely to be 0.4 per cent, which is lower than the 0.6 per cent estimated by the Reserve Bank of India (RBI). This is mainly because the prices of food items have gone down. It stated "we expect CPI to settle at 0.4 per cent in Q3, slightly lower than RBI's projection of 0.6 per cent. The report said that its in-house indicator, called the BoB Economic Conditions Indicator (ECI), is at -2.8 per cent for the first 11 days of December 2025. This shows that price pressure is weak and inflation is under control. According to the report, overall inflation, also called headline inflation, is low mainly because food prices are falling. Vegetables like tomato, onion and potato have become cheaper. While tomato prices have started rising a little, the report said this is not a big worry. There is enough supply of vegetables in markets, as shown by mandi arrival data. On the whole, the prices of tomato, onion and potato are still falling at a fast pace. This is helping keep food prices low. The report also said inflation showed some relief in November 2025, again because food prices were lower. There was a small increase in vegetable prices compared to the previous month, but this is normal. Harvesting season usually helps bring prices down, and market supply data remains positive. Apart from food, the report looked at other items like household goods and services. It said prices of these items are also mostly stable. One reason is the GST effect, which has helped stop prices from rising too much, even during the festive season when people buy more things. Bank of Baroda said its estimate of 0.4 per cent inflation in Q3 is slightly lower than the RBI's estimate of 0.6 per cent. The bank believes that falling food prices will continue to keep inflation low for most of this financial year. So the report outlined that because food is cheaper and supplies are good, prices are staying low. This is good news for people, as it means daily expenses are not increasing much. (ANI)
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