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SBI Report Projects India’s Inflation to Remain Below 4% in H1 FY26.

Banking & Finance | Dated: 08 Apr 2025

On April 6, 2025, a report released by the State Bank of India (SBI), headquartered in Mumbai, Maharashtra, projected that India's retail inflation may remain between 3.9% and 4.0% during the first half (April to September) of Financial Year 2025-26 (H1 FY26). If realized, this would mark the first time in recent years that inflation remains below 4% for two consecutive quarters.

🎯 Key Highlights:

  • - Consumer Price Index (CPI) inflation is expected to fall to 3.8% in Q4 of FY25, with the average inflation for FY25 projected at around 4.6%.
  • - Core inflation (excluding food and fuel) is forecasted to range between 4.2% and 4.3% in FY26.
  • - The report also anticipates that India’s current account balance could record a surplus in Q4 FY25, driven by rising net service receipts despite a widening merchandise trade deficit.

💡 Other Important Facts:

  • (i) In Q3 FY25, India's Current Account Deficit (CAD) stood at USD 11.5 billion, or 1.1% of GDP, rising from USD 10.4 billion in Q3 FY24.
  • (ii) The merchandise trade deficit increased to USD 79.2 billion, up from USD 71.6 billion in the same quarter of the previous fiscal year.

📚 Test Your Knowledge:

According to a recent SBI report, India’s retail inflation is projected to remain below which percentage in the first half of FY26?

Correct Answer: 4%

🚀 Quick Recap:

About SBI

  • Chairman : Challa Sreenivasulu Setty
  • Headquarter : Mumbai