India’s Inflation Rate MoM: November 2025 Analysis and Macro Outlook
The latest inflation rate MoM for India, released on November 12, 2025, registered a 0.15% increase, modestly above October’s 0.10% but well below the 0.60% consensus estimate. This report leverages data from the Sigmanomics database to place the current inflation trajectory in historical context, assess its drivers, and explore implications for monetary policy, fiscal stance, and financial markets amid evolving geopolitical risks.
Table of Contents
India’s inflation rate MoM at 0.15% in November 2025 marks a slight acceleration from October’s 0.10%, yet remains subdued compared to mid-year peaks. The inflation environment reflects a complex interplay of domestic demand recovery, supply chain normalization, and external price pressures. This section contextualizes the latest print within India’s broader macroeconomic landscape and global influences.
Drivers this month
- Food prices stabilized, contributing 0.04 pp to inflation.
- Energy costs edged up modestly, adding 0.03 pp.
- Core inflation components, including housing and transport, contributed 0.08 pp.
Policy pulse
The 0.15% MoM inflation remains below the Reserve Bank of India’s (RBI) 4% annual target band when annualized, signaling limited immediate pressure for aggressive rate hikes. The RBI’s accommodative stance is likely to persist, balancing growth support with inflation containment.
Market lens
Immediate reaction: The Indian rupee (INR) depreciated 0.20% against the USD within the first hour post-release, reflecting mild disappointment versus expectations. Short-term government bond yields rose by 5 basis points, signaling cautious investor recalibration.
Core macroeconomic indicators underpinning the inflation trend include GDP growth, wage dynamics, and commodity prices. India’s GDP growth for Q3 2025 was reported at 6.10% YoY, supporting moderate demand-pull inflation. Wage growth remains steady at 5.50% YoY, sustaining consumer purchasing power.
Monetary Policy & Financial Conditions
The RBI’s repo rate stands at 6.25%, unchanged since September 2025. Financial conditions remain accommodative, with credit growth at 12% YoY and stable liquidity. Inflation prints below estimates reduce pressure on the central bank to tighten policy imminently.
Fiscal Policy & Government Budget
India’s fiscal deficit is projected at 5.90% of GDP for FY2025-26, slightly above target due to increased infrastructure spending. The government’s stimulus measures continue to support demand, but fiscal prudence remains a priority to avoid overheating inflation.
External Shocks & Geopolitical Risks
Global crude oil prices have stabilized near $85/barrel, limiting imported inflation. However, geopolitical tensions in the Indo-Pacific region pose upside risks to energy and commodity prices, which could feed into domestic inflation if prolonged.
Drivers this month
- Food and beverages: 0.04% MoM, reflecting stable crop output.
- Energy: 0.03% MoM, supported by steady crude prices.
- Housing and utilities: 0.05% MoM, driven by rising rents.
- Transport: 0.03% MoM, due to higher fuel costs.
This chart highlights a trend of inflation stabilizing after a volatile first half of 2025. The moderation from August’s peak suggests easing supply constraints, but persistent core inflation components indicate underlying price pressures remain. The trajectory points to a cautious but steady inflation environment heading into 2026.
Policy pulse
Inflation remains within the RBI’s comfort zone, supporting a steady monetary policy stance. The central bank’s forward guidance emphasizes data dependency, with inflation prints like November’s reinforcing a wait-and-watch approach.
Market lens
Immediate reaction: The 2-year government bond yield rose 7 basis points post-release, reflecting slight repricing of inflation risk. The INR/USD pair weakened marginally, signaling investor caution amid mixed inflation signals.
Looking ahead, inflation in India faces a mix of supportive and constraining factors. The base case scenario projects inflation averaging 0.18% MoM over the next quarter, driven by stable commodity prices and moderate demand growth.
Scenario analysis
- Bullish (20% probability): Inflation moderates below 0.10% MoM as supply chains normalize and fiscal tightening reduces demand.
- Base (60% probability): Inflation remains around 0.15-0.20% MoM, reflecting balanced demand-supply dynamics and stable energy prices.
- Bearish (20% probability): Inflation accelerates above 0.30% MoM due to geopolitical shocks pushing oil prices higher and wage pressures intensifying.
Structural & Long-Run Trends
India’s inflation dynamics are increasingly influenced by urbanization, digitalization, and evolving consumption patterns. Long-run trends suggest moderate inflation persistence, with structural reforms and improved supply chains potentially dampening volatility.
India’s November 2025 inflation rate MoM of 0.15% signals a modest uptick but remains well below consensus forecasts. The data supports a steady monetary policy stance amid balanced macro risks. External shocks and fiscal policy will be key to watch as India navigates inflation pressures in a complex global environment.
Key Markets Likely to React to Inflation Rate MoM
Inflation data in India typically influences currency, bond, and equity markets. The USDINR pair reacts sensitively to inflation surprises, reflecting currency risk. Government bond yields, tracked via IND10Y, adjust to inflation expectations. Equities such as NSEI respond to inflation-driven policy shifts. Additionally, the crypto asset BTCUSD often moves inversely to inflation fears, while the EURINR pair reflects broader currency sentiment linked to inflation trends.
Inflation vs. USDINR Since 2020
Monthly inflation rates in India show a positive correlation with the USDINR exchange rate over the past five years. Periods of rising inflation have coincided with INR depreciation, as inflation pressures prompt expectations of monetary tightening and capital outflows. The chart below illustrates this relationship, highlighting inflation spikes in 2021 and 2023 alongside INR weakness.
| Year | Avg Inflation MoM (%) | USDINR Avg Rate |
|---|---|---|
| 2020 | 0.08 | 74.50 |
| 2021 | 0.22 | 75.80 |
| 2022 | 0.15 | 77.10 |
| 2023 | 0.25 | 79.30 |
| 2024 | 0.12 | 78.60 |
| 2025 (YTD) | 0.14 | 80.20 |
FAQs
- What is the latest inflation rate MoM for India?
- The most recent inflation rate MoM for India is 0.15% for November 2025, slightly above October’s 0.10%.
- How does this inflation reading affect RBI’s monetary policy?
- The subdued inflation print supports the RBI’s current steady policy stance, reducing immediate pressure for rate hikes.
- What are the main risks to India’s inflation outlook?
- Key risks include rising global oil prices due to geopolitical tensions and domestic wage pressures that could accelerate inflation.
Key takeaway: India’s inflation is stabilizing at moderate levels, supporting steady monetary policy but requiring vigilance on external shocks and fiscal discipline.
This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.
Key Markets Likely to React to Inflation Rate MoM
India’s inflation data strongly influences currency, bond, and equity markets. The USDINR currency pair often moves inversely to inflation surprises, reflecting exchange rate risk. Government bond yields, tracked by IND10Y, adjust to inflation expectations and monetary policy outlook. The equity index NSEI reacts to inflation-driven policy shifts impacting corporate earnings. The crypto asset BTCUSD often serves as an inflation hedge, moving inversely to inflation fears. Lastly, the EURINR pair reflects broader currency sentiment linked to inflation trends.
The November 2025 inflation rate MoM of 0.15% compares with 0.10% in October and an average monthly inflation of 0.12% over the past 12 months. This marks a mild uptick after a subdued October, following a peak of 0.93% in August 2025.
Historical comparisons reveal a volatile inflation pattern this year: February and March saw deflationary pressures (-0.97% and -0.47% MoM respectively), while summer months experienced sharp rebounds. The current figure suggests a moderation from the mid-year highs but a stabilization above early 2025 lows.