Consumer Price Index (CPI) and Inflation Measurement
The Consumer Price Index (CPI) measures the weighted average of prices of a basket of consumer goods and services, such as food, medical care, education, and transportation. In India, the CPI (Combined) — released monthly by MoSPI — is the official inflation measure used for the RBI's monetary policy framework. It replaced the earlier Wholesale Price Index (WPI) as the policy-relevant measure following the adoption of flexible inflation targeting in 2016.
- India's CPI basket has a weight of approximately 45.86% for food and beverages — the single largest component — making food price volatility a dominant driver of headline inflation.
- CPI (Urban), CPI (Rural), and CPI (Combined/All India) are the three variants; the combined index is used for monetary policy.
- Core CPI (headline minus food and fuel) is watched closely as a measure of underlying demand-side inflation.
- The base year for India's current CPI series is 2012 (i.e., 2012 = 100).
- Inflation below the lower tolerance bound of 2% can signal deflationary risks; the February 2026 projection of 2.1% is close to this boundary.
● Tracked since February 06, 2026 · last seen April 12, 2026 · updates as the daily brief publishes
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