Kolkata: Leading ratings agency CRISIL Limited in its report said that headline inflation based on the CPI fell to 2.8 per cent in May, 2025, which is a good omen for the economy. According to CRISIL, a decline in food inflation is pulling down the headline retail inflation, but core inflation is edging up.

The core inflation basket in India includes all items in the CPI basket except for food and fuel. This typically includes items like: clothing and footwear; housing; household goods and services; health; education; transport and communication; personal care; and, recreation and entertainment.

Although remaining below the decadal trend, the core inflation has been now above four per cent for four months in a row. CRISIL said a persistent rise in core inflation can put pressure on headline inflation. According to the ratings firm, rising core inflation is indicative of strengthening domestic demand in the economy.