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Business Standard
12-06-2025
- Business
- Business Standard
Bank of Maharashtra cuts retail loan rates by up to 50 bps post RBI move
Bank of Maharashtra on Thursday announced a reduction of up to 50 basis points in interest rates on retail loans, including home, car, education and other loans linked to the Repo Linked Lending Rate (RLLR). According to the bank, the revised rates are effective from 10 June and align with the recent rate reduction by the Reserve Bank of India (RBI). The bank stated that home loans will now start at 7.35 per cent and car loans at 7.7 per cent. 'This benefit of reduced interest rates reflects the bank's commitment to offer the best financing solutions to all its customers and help them fulfil their dreams,' the bank said. It added, 'In the current interest rate landscape, the bank is making retail loans cheaper to bring in cheer among its customers.' Banking industry Bank of Baroda has also reduced its Marginal Cost of Funds Based Lending Rate (MCLR) by 5 basis points across various tenors ranging from one month to one year. Additionally, three other public sector banks—Canara Bank, Union Bank of India and Indian Overseas Bank—have cut their External Benchmark Lending Rates (EBLR) by 50 basis points. Canara Bank and Union Bank's repo-linked lending rates now stand at 8.25 per cent, while Indian Overseas Bank's RLLR is 8.35 per cent. These rates apply to retail loans, including home, vehicle and personal loans, as well as loans extended to the micro, small and medium enterprises (MSME) sector. These rate adjustments follow the Reserve Bank of India's decision on Friday to reduce the benchmark repo rate by 50 basis points to 5.5 per cent. The six-member Monetary Policy Committee, chaired by Governor Sanjay Malhotra, voted five to one in favour of the rate cut. The RBI also lowered the Cash Reserve Ratio (CRR) by 100 basis points to 3 per cent in phases, which is expected to inject ₹2.5 lakh crore into the banking system. Inflation data India's retail inflation eased to 2.82 per cent in May from 3.16 per cent in April, primarily due to a slower pace of food price increases, according to government data released on Thursday. In rural areas, headline inflation fell to 2.59 per cent in May from 2.92 per cent in April, while food inflation based on the Consumer Food Price Index declined to 0.95 per cent from 1.85 per cent during the same period.
Indian Express
12-06-2025
- Business
- Indian Express
Fall in food prices pulls down May CPI inflation to 2.82%, lowest since Feb 2019
A fall in prices of fruits, pulses, and cereals helped lower India's headline retail inflation rate to a 75-month low of 2.82 per cent in May 2025, acording to data released on Thursday by the Ministry of Statistics and Programme Implementation (MoSPI), possibly providing some more easing room to the Reserve Bank of India (RBI). At 2.82 per cent, the latest inflation rate based on the Consumer Price Index (CPI) was somewhat lower than economists' expectations of around 3 per cent. CPI inflation stood at 3.16 per cent in April 2025 and 4.80 per cent in May 2024. The last time retail inflation was lower was in February 2019, when it stood at 2.57 per cent. Per MoSPI data, food inflation as measured by the Consumer Food Price Index (CFPI) almost halved to a 43-month low of 0.99 per cent last month from 1.78 per cent in April 2025 as fruit prices declined by 2 per cent month-on-month (m-o-m) while those of pulses were down 1.7 per cent. Cereals also helped to bring down the overall food inflation in May 2025, with prices down 0.6 per cent compared to the previous month. Prices of vegetables, meanwhile, inched up slightly last month from April 2025. However, in year-on-year (y-o-y) terms, retail prices of vegetables were down 13.7 per cent — the sharpest pace of decline since December 2022, according to Paras Jasrai, associate director and economist at India Ratings & Research. Proteins became more expensive on a sequential basis in May 2025. While the price of meat and fish was up 1.5 per cent m-o-m, egg prices rose 2.5 per cent and milk turned 0.7 per cent more expensive in May. Core inflation — which excludes items whose prices are volatile such as food and fuel and is seen as an indicator of underlying demand conditions — inched up to around 4.2 per cent, according to calculations done by The Indian Express. The steady rise in core inflation over the last year-and-a-half or so is suggestive of 'steady demand conditions' in the economy, said Jasrai of India Ratings. In terms of the regional break-up, urban inflation eased to 3.07 per cent in May 2025 from 3.36 per cent the previous month, while rural CPI inflation declined to 2.59 per cent from 2.92 per cent. Inflation in May 2025 was highest in Kerala at 6.46 per cent, while it was lowest in Telangana, at 0.55 per cent. According to Sujan Hajra, chief economist at Anand Rathi Group, the downward trend in CPI inflation is expected to continue through October 2025, with averaging for FY26 likely to undershoot the RBI's latest forecast of 3.7 per cent. ICRA Chief Economist, Aditi Nayar, expects retail inflation to decline further to around 2.5 per cent in June 2025 and average 3.5 per cent in FY26. 'Looking ahead, on a y-o-y (year-on-year) basis, as many as 17 of the 22 food items for which the daily data is released, recorded a lower y-o-y inflation in June 2025 (until June 10, 2025) vis-à-vis May 2025, barring most edible oils and tea,' Nayar said. 'Moreover, the GoI (Government of India) has reduced the import duty on edible oils effective end-May 2025, which would lead to a softening in prices going forward, thereby auguring well for the oils and fats inflation readings through the fiscal, which would also be suppressed by a high base.' Rajani Sinha, chief economist at CareEdge, said that while the India Meteorological Department's forecast of an above-normal monsoon reinforces the favourable outlook for food inflation, the spatial and temporal distribution of the rains will be critical. 'Despite the early onset, monsoon activity has slowed, although it remains early in the season, with potential for recovery in the coming weeks. Weather-related risks will need close monitoring,' Sinha added. While the RBI's Monetary Policy Committee (MPC) last week cut the policy repo rate by an unexpectedly large 50 basis points (bps) to 5.50 per cent, it also tightened the stance of its policy to 'neutral' from 'accommodative', arguing that 'monetary policy is left with very limited space to support growth'. However, economists see the space for more one rate cut from the MPC, although not at the committee's next meeting in August 2025. Jasrai of India Ratings, for instance, expects a status quo on interest rates in August 2025 considering inflation is heading for the RBI's forecast of 2.9 per cent for April-June 2025 and the monetary easing affected so far. 'We expect, at max one more 25 bps cut this fiscal, unless there are surprises from global development or growth declines sharply,' Jasrai said. On Tuesday, the World Bank lowered its global growth forecast for 2025 to 2.3 per cent from its January 2025 prediction of 2.7 per cent citing 'heightened trade tensions and policy uncertainty'. Growth in 2026 is expected to pick up only slightly to 2.4 per cent and further to 2.6 per cent in 2027. While a global recession is not expected, the World Bank's latest projections for the next two years, should they turn out as forecast, would mean average global growth in the first seven years of the 2020s will be the slowest of any decade since the 1960s, it said. Siddharth Upasani is a Deputy Associate Editor with The Indian Express. He reports primarily on data and the economy, looking for trends and changes in the former which paint a picture of the latter. Before The Indian Express, he worked at Moneycontrol and financial newswire Informist (previously called Cogencis). Outside of work, sports, fantasy football, and graphic novels keep him busy. ... Read More
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Business Standard
12-06-2025
- Business
- Business Standard
India's retail inflation dips to over 6-year low of 2.82% in May: Govt data
India's retail inflation dropped to 2.82 per cent in May, down from 3.16 per cent in April, mainly due to a slower increase in food prices, according to government data released on Thursday. Food inflation in rural areas stood at 0.95 per cent and at 0.96 per cent in urban centres. The overall decline was driven by negative year-on-year inflation in vegetables (-13.7 per cent), pulses (-8.22 per cent), and spices (-2.82 per cent). Key staple categories like cereals and sugar witnessed moderate increases, with inflation of 4.77 per cent, and 4.09 per cent, respectively, while milk and oil products saw inflation of 3.15, and 17.91 per cent, respectively. Notably, prices of onions, tomatoes and potatoes registered strong deflation, which weighed heavily on the overall food basket. Meanwhile, prices of pulses dropped 8.22 per cent, following a 5.23 per cent decline in the previous month. May retail inflation: Rural and urban In rural India, headline and food inflation saw a notable drop in May 2025. Provisional data shows rural headline inflation stood at 2.59 per cent in May, down from 2.92 per cent in April. Food inflation, based on the Consumer Food Price Index (CFPI), also declined to 0.95 per cent in May from 1.85 per cent in the previous month. Urban areas also experienced a decline in inflation. Headline inflation in the urban sector fell to a provisional 3.07 per cent in May 2025, compared to 3.36 per cent in April. Food inflation in cities dropped significantly to 0.96 per cent in May from 1.64 per cent a month earlier. Housing: The year-on-year inflation rate for the housing segment stood at 3.16 per cent in May 2025 (provisional), slightly higher than 3.06 per cent recorded in April. Education: Inflation in the education sector remained largely stable, with a marginal dip to 4.12 per cent in May 2025, compared to 4.13 per cent in April. Health: Health-related inflation rose to 4.34 per cent in May 2025 (provisional), up from 4.25 per cent in the previous month. Transport and communication: The inflation rate for transport and communication increased to 3.85 per cent in May 2025, compared to 3.67 per cent in April. Fuel and light: Inflation in the fuel and light category eased to 2.78 per cent in May 2025, down from 2.92 per cent in April.
Time of India
12-06-2025
- Business
- Time of India
CPI inflation eases to 2.82% in May, logs 6-year low; food prices lead broad-based decline
India's headline retail inflation fell to 2.82% in May 2025, the lowest year-on-year rate since February 2019, according to data released by the National Statistical Office (NSO) on Wednesday. The Consumer Price Index (CPI) reading was down 34 basis points from 3.16% in April, driven primarily by a sharp moderation in food prices and a favourable base effect. Food inflation, measured by the Consumer Food Price Index (CFPI), dropped to 0.99% in May, its lowest since October 2021. This represents a steep fall from 1.78% in April and 8.69% in May 2024. The NSO attributed this easing to declining prices across key food categories including pulses, vegetables, fruits, cereals, eggs, sugar, and household goods and services. Rural and urban inflation trends Rural CPI inflation declined to 2.59% in May from 2.92% in April, while rural food inflation dropped to 0.95% from 1.85%. Urban CPI inflation eased to 3.07%, down from 3.36%, with urban food inflation falling to 0.96% from 1.64%. Sectoral inflation overview Housing inflation (urban only): 3.16% (vs 3.06% in April) Education inflation (combined): 4.12% (vs 4.13%) Health inflation (combined): 4.34% (vs 4.25%) Transport & Communication (combined): 3.85% (vs 3.67%) Fuel & Light (combined): 2.78% (vs 2.92%) Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Time of India
27-05-2025
- Business
- Time of India
Companies pause packaged food price hikes as input costs stabilise
New Delhi: Makers of grocery staples such as snacks, biscuits and tea have paused price hikes after three back-to-back quarters of 5-10% increases across pack sizes, as key commodity prices like palm oil and wheat stabilise. Executives at companies such as Britannia, Wipro Consumer, Parle Products and Bikaji Foods said they are pausing price increases. Some said they are also bringing back selective consumer promotions to boost sales even as urban demand remains under stress, their executives said. "(While) we see no price reduction or grammage increase in the next couple of quarters, there will be no more price increases for sure," Varun Berry, managing director of Britannia Industries , told ET. While the maker of Nutrichoice biscuits and Laughing Cow cheese did some strategic buying of wheat and flour, most of its commodities are priced at the same level as at the end of FY25, he said. "Flour is just slightly lower than the exit price of last year despite the wheat season," he added. Deepak Agarwal, MD, Bikaji Foods, too, said the snacks firm would not increase prices as some inflation is under control and raw material costs are reducing. "Selective consumer offerings and promotions will be reintroduced to get better market share and momentum," he added. Companies making daily essentials and grocery products had been increasing prices by 5-10% on higher raw material costs while maintaining that they withheld some of the cost pressures amid stagnating sales in cities. With food inflation expected to remain low, company executives expect their retail prices to remain steady. "Core inflation will likely remain range-bound, led by weaker commodity prices, softer growth and a stronger rupee," HSBC Research said in a report released on Monday. This, it said, is a relief for consumers and "may fuel the purchasing power of households." Anil Chugh, president, food business, at Wipro Consumer Care , said the overall food inflation is expected to remain in the region of 3-4% in the coming two quarters. "This is because of commodity prices stabilising, expected good monsoon and companies taking cautious approach to price increases," he said. Wipro Consumer Care makes Nirapara ready-to-cook foods and Granamma snacks. "For 3 quarters, prices were increasing," said Mayank Shah, vice president at Parle Products. "Now the hikes have been paused as some commodities are stable. Some key commodities are still higher than a year ago, but what's happened is that the rate of inflation has come down for now." The food inflation rate dropped to 1.78% year-on-year in April 2025, compared to a year-on-year Consumer Food Price Index of 10.87% in October 2024, according to government data. "Going forward, we expect tea pricing/ tea costs to soften rather than pricing going up (if the tea crop is normal). So, therefore, margins will come back," Sunil D'Souza, managing director, Tata Consumer Products , said in a quarter four post earnings call. NielsenIQ in its January-March quarter update earlier this month had said the FMCG industry grew 11% year-on-year by value, driven by a 5.6% price hike. Growth of packaged foods slowed to 4.9% in the January-March quarter compared to 6% in the fourth quarter of 2024, which the report attributed to declining lower volumes in edible oils and palm oil, impacted by higher prices. The past three quarters had seen surging prices of wheat (which increased 17.4% year-on-year in the March quarter), palm oil (17.2%) and cocoa (78%).
