India Inflation Cools to 1.55%, an Eight-Year Low

India’s headline consumer price index rose 1.55% in July from a year earlier, government data showed on Tuesday, easing from 2.10% in June and marking the ninth consecutive month of disinflation. The reading undershot the 1.76% median estimate in a Reuters survey and is the lowest inflation rate since June 2017. The slowdown was driven by a continued drop in food prices, with the food component of the index contracting 1.76% after a 1.06% decline in June. Core price details were not released, but economists said the sharp fall suggests the recent slide in commodity costs and favourable harvest conditions are feeding through to retail shelves. The Reserve Bank of India, which kept its policy rate unchanged at 5.5% last week, said the inflation outlook for the fiscal year ending March 2026 has become "more benign," projecting an average 3.1%. Analysts said the latest data could give the central bank room to consider a rate cut later this year should growth soften amid rising global trade tensions.