Owning a home is a dream for many, but economic factors like inflation can significantly impact affordability. With the inflation rate in India projected to reach historic lows in 2025, now is an opportune time for aspiring homeowners to take the leap. Bajaj Finserv Home Loan, with interest rates starting from 7.45%* p.a, offers a seamless borrowing experience tailored to meet diverse financial needs. From quick online approvals to flexible repayment options, Bajaj Finserv ensures that your journey to homeownership is hassle-free.
What is inflation rate?
The inflation rate reflects the pace at which the general price level of goods and services rises over a specific period. It directly affects the purchasing power of money, making everyday expenses like groceries, fuel, and housing either more affordable or costlier. For homebuyers, inflation plays a vital role in determining borrowing costs.
For example, lower inflation typically leads to reduced interest rates, making home loans more affordable. Conversely, during periods of high inflation, borrowing costs may rise, impacting monthly EMIs (Equated Monthly Instalments). Bajaj Finserv Home Loan helps mitigate these challenges by offering competitive interest rates and flexible tenures to fit your financial goals.
India’s current inflation rate
As of June 2025, India’s Consumer Price Inflation (CPI) stands at 2.10%, the lowest since January 2019. This decline can be attributed to stabilising global commodity prices, improved domestic production, and prudent monetary policies by the Reserve Bank of India (RBI).
For homebuyers, a lower inflation rate translates to reduced borrowing costs. Bajaj Finserv Home Loan, with interest rates starting at 7.35%* p.a., enables you to capitalise on this favourable economic environment. Whether you are purchasing your first home, renovating an existing property, or transferring your loan balance, Bajaj Finserv offers tailored solutions to make homeownership affordable.
India inflation rate (CPI) — historical data
The Consumer Price Index (CPI) measures the average change in prices of household goods and services over time. Below is a summary of India’s CPI trends in recent years:
| Year | CPI Inflation Rate |
|---|---|
| 2021 | 5.52% |
| 2022 | 6.08% |
| 2023 | 4.74% |
| 2024 | 3.18% |
| 2025 | 2.10% (June) |
The steady decline in CPI highlights improved economic stability, making it an ideal time to invest in a home. Use the Bajaj Finserv Home Loan EMI Calculator to estimate your monthly repayments and plan your finances effectively.
India inflation rate (WPI) — last one year data
The Wholesale Price Index (WPI) tracks changes in the prices of goods at the wholesale level, influencing production costs and, subsequently, housing prices. Here is a snapshot of WPI trends over the past year:
| Month | WPI Inflation Rate |
|---|---|
| July 2024 | 1.88% |
| August 2024 | 1.52% |
| September 2024 | 1.31% |
| October 2024 | 1.12% |
| November 2024 | 0.98% |
| December 2024 | 0.85% |
| January 2025 | 0.70% |
| February 2025 | 0.55% |
| March 2025 | 0.42% |
| April 2025 | 0.30% |
| May 2025 | 0.25% |
| June 2025 | 0.15% |
For instance, if you are purchasing a Rs. 50 lakh property, Bajaj Finserv’s competitive home loan rates can help you save significantly, even as construction material prices fluctuate.
What is CPI?
The Consumer Price Index (CPI) is an economic indicator that measures the average price changes of a basket of goods and services consumed by households. It reflects the cost of living and directly impacts your monthly budget and loan repayment ability.
By choosing Bajaj Finserv Home Loan, you can manage your finances better, thanks to features like tenure flexibility of up to 32 years and advanced digital tools for loan monitoring.
What is WPI?
The Wholesale Price Index (WPI) measures the price changes of goods at the wholesale level before they reach consumers. It is a critical indicator for understanding trends in production costs, which influence property prices and housing affordability.
Bajaj Finserv Home Loan provides financial flexibility to counter rising property costs, offering options like top-up loans and balance transfers to ease your financial burden.
How is inflation calculated?
Inflation is calculated using the following formula:
Inflation Rate (%) = [(Current Price Index - Previous Price Index) / Previous Price Index] x 100
For example, if the CPI was 100 last year and has risen to 102 this year, the inflation rate would be:
[(102 - 100) / 100] x 100 = 2%
Bajaj Finserv borrowers can plan ahead using advanced loan monitoring tools available 24x7 online, ensuring that you stay on top of your financial commitments.
Types of inflation
Cost-push inflation
This occurs when production costs, such as raw materials and wages, increase, leading to higher prices for goods and services.
Tip: Opt for a longer loan tenure with Bajaj Finserv Home Loan to reduce your monthly EMI burden during inflationary periods.
Demand-pull inflation
This happens when demand for goods and services exceeds supply, driving up prices.
Tip: Adding a co-applicant can enhance your loan eligibility and ease financial stress.
Built-in inflation
This is caused by the expectation of future inflation, leading to higher wages and prices.
Tip: Lock in competitive interest rates with Bajaj Finserv Home Loan to safeguard yourself from rising borrowing costs.
Inflation breakdown for June 2025
Below is a detailed breakdown of inflation trends in June 2025:
| Category | Inflation Rate (CPI) | Inflation Rate (WPI) |
|---|---|---|
| Food and Beverages | 2.50% | 1.10% |
| Housing | 1.80% | 0.90% |
| Fuel and Light | 3.20% | 2.00% |
| Miscellaneous | 1.50% | 0.70% |
With zero foreclosure charges on floating-rate loans, Bajaj Finserv helps you manage inflation better while saving more on interest costs.
Conclusion
With India’s inflation rate at a historic low in 2025, the economic environment is highly favourable for homebuyers. Bajaj Finserv Home Loan offers a perfect blend of affordability, convenience, and flexibility, ensuring that you can achieve your dream of owning a home without financial strain.
Apply online today for your Bajaj Finserv Home Loan and take the first step toward owning your dream home!
