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India’s Retail Inflation Climbs to 1.33% in December 2025

13 January 20261 min read
ECONOMYIndia’s RetailInflation Climbs to1.33% in December202513 January 2026safalsetu.com

Why in the news

CPI inflation for December 2025 came in at 1.33%, the highest of the last three months, but still beneath the lower end of the RBI’s comfort band.

Key facts

  • December 2025 reading: CPI inflation at 1.33%, the best level in three months for price growth.
  • Position versus band: below the 2% lower tolerance level.
  • RBI target: 4% with a ±2% tolerance band.

About retail inflation

It captures the pace at which household purchase prices climb, and India follows it using the Consumer Price Index (CPI).

PointDetail
CoverageFood, clothing, housing, fuel and light, transport, education, healthcare and more
Published byMinistry of Statistics and Programme Implementation, monthly
Why it mattersShows cost of living and affects household budgets
Policy linkRBI uses CPI inflation to set monetary policy

Exam angle

  • Tolerance band: lower limit 2%, upper limit 6%, around a 4% target.
  • CPI compiled by the statistics ministry, not the RBI.

Test yourself

1. What was India's retail inflation (CPI) in December 2025?

CPI rose to 1.33%, a three-month high.

2. Which body releases India's monthly CPI data?

MoSPI releases CPI data every month.

3. What inflation target does the RBI follow, as per the notes?

The target is 4% with a ±2% tolerance band.