New Delhi, Dec 13 || The reduction in goods and services tax (GST) is expected to cut consumer price index (CPI) inflation by roughly 25 basis points in the September–November 2025 period and could reduce 35 basis points this fiscal (FY26), a new report has said.
The report from State Bank of India (SBI) said that Q1 FY27 inflation forecasts were lowered by about 100 basis points to 3.9 per cent from 4.9 per cent. The Q3 FY26 estimate was revised to 3.8 per cent from an earlier 0.6 per cent, it added.
With continued lower food inflation, with higher kharif production, healthy rabi sowing, adequate reservoir levels and conducive soil moisture, SBI forecasted inflation for FY26 at 1.8 per cent and for FY27 at 3.4 per cent.
The Reserve Bank of India (RBI), in its December policy, reduced its FY26 inflation projection to 2 per cent from an October estimate of 2.6 per cent and a February estimate of 4.2 per cent.