Urban Food Index- Feb 7th Update
Our India Urban Food Index shows a decline to ₹925 (–2.2%), marking the sharpest correction in recent weeks, even as volatility rose to 51.59 and affordability improved to 1.39%. The pullback was led by vegetables — with tomato, onion and potato prices easing on improved arrivals. Healthy Rabi sowing progress, steady wholesale market arrivals and adequate buffer positions continue to anchor the supply backdrop despite localized fluctuations.
The latest move reinforces a gradually improving inflation configuration, supported by lower food costs and a relatively stable rupee that tempers imported price risks, even as global energy markets remain fluid. Against this backdrop, the Reserve Bank of India has maintained the repo rate at 6.25%, signalling a cautious, data-dependent pause while monitoring liquidity conditions and external volatility. For policymakers, the durability of supply-side easing and currency stability will determine whether price pressures continue to ease, while markets will watch for persistent cooling before pricing in a clearer shift in the rate trajectory.