Crisil

In a recent analysis, leading ratings agency CRISIL reported a decline in India’s Consumer Price Index (CPI)-based headline inflation to 2.8% in May 2025, signaling a positive trend for the economy. However, the report raises concerns about a steady uptick in core inflation—which excludes food and fuel—crossing the 4% mark for four consecutive months. While the moderation in food prices is easing headline inflation, the sustained increase in core metrics points to underlying pressures, partially fueled by global volatility.

According to the latest 'Roti Rice Rate' report by Crisil, home-cooked meal prices have seen a slight decline due to lower vegetable costs. The report reveals that the price of a vegetarian thali fell marginally, while non-vegetarian thalis saw a more significant drop in May 2025 compared to April 2025 and the same period last year. The decrease is largely attributed to a sharp fall in vegetable prices, particularly tomatoes, onions, and potatoes, as well as a drop in broiler prices. However, certain costs like vegetable oil and LPG saw a rise, partially offsetting the overall decline.

India’s banking sector is set for an upswing in credit growth in the upcoming fiscal year, with domestic rating agency Crisil forecasting a rise to 13% in FY26 from 11% in FY25. This acceleration is expected to stem from favorable regulatory interventions, improved liquidity conditions, and tax-driven boosts to consumption. Retail credit, mortgages, and corporate lending to infrastructure-linked industries are anticipated to drive the expansion. However, the pace of deposit growth remains a key variable, with recent liquidity trends suggesting cautious optimism.