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Inflation

About Inflation

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What is Inflation

Inflation can be defined as a persistent rise in the general price of goods and services of common or daily use — such as clothing, food, fuel, transport, etc — which results in an increase in the cost of living.
 
Inflation is the measure of change in average price of services and commodities, done at regular intervals. It indicates a decrease in the purchasing power of a unit of a nation’s currency as the products and services get more expensive. Basically, inflation is the difference between aggregate demand and aggregate supply of goods and services. When aggregate demand exceeds the supply of goods at current prices, there is a rise in the price level.
 
A certain level of inflation is required in the economy to ensure that expenditure is promoted and money hoarding through savings is discouraged.
 
How is inflation measured?
 
In India, there are two main sets of inflation indices to measure changes in price levels — Consumer Price Index (CPI) and Wholesale Price Index (WPI). These indices measure changes at the retail and wholesale price levels, respectively. CPI tracks any shift in retail prices of essential and daily goods and services consumed by households across the country. In short, it captures changes in price level at the consumer level.
 
WPI, on the other hand, is the average change in the price of commodities at the wholesale level. It considers the price of goods traded among corporations, not goods purchased by consumers. The aim of WPI is to monitor price drifts that reflect demand and supply in manufacturing, industry and construction. 
 

Latest Updates on Inflation

Datanomics: US imposes 25% tariff, worsening Iran's economic stress

As the US slaps fresh tariffs on Iran's trading partners, India faces little fallout - but the move underscores Tehran's deepening economic stress under decades of sanctions

Updated On: 14 Jan 2026 | 11:19 PM IST

CPI inflation 2011-12 series: End of an era as new base begins next month

CPI-food inflation peaked at 16.12 per cent in April 2018, while the lowest reading was recorded in April 2019

Updated On: 12 Jan 2026 | 10:47 PM IST

Q3 earnings, inflation data key drivers for markets this week: Analysts

Trading activity of foreign investors would also be keenly tracked by investors, experts noted

Updated On: 11 Jan 2026 | 4:47 PM IST

India consumer price inflation likely rose to 1.50% in December

Core inflation, excluding food and fuel components, likely edged up to 4.53 per cent in December from an estimated 4.2 per cent-4.3 per cent in Nov, ‍partly due to a 7 per cent rally in gold prices

Updated On: 09 Jan 2026 | 8:22 AM IST

Ind-Ra sees 'Goldilocks' FY27 as domestic reforms offset tariff risks

External demand is expected to fare better in FY27 than in FY26, aided by recently concluded trade agreements with the UK, New Zealand and Oman, and the prospect of a US trade deal later in the fiscal

Updated On: 06 Jan 2026 | 10:55 PM IST

India's FMCG sector likely to see 5% volume growth in coming months

After nearly 18 months of lukewarm performance, the FMCG sector registered a volume growth of 5.3 per cent in the August-October period of 2025

Updated On: 06 Jan 2026 | 9:14 PM IST

Govt likely to retain 4% inflation target for RBI, seeks feedback

The Reserve Bank of India currently aims to keep inflation anchored around 4%, the mid-point of a 2%-6% range mandated by the government

Updated On: 05 Jan 2026 | 6:26 PM IST

Why investors should stop predicting markets in 2026: Deepak Shenoy answers

The world has slowly changed into a format that seems to hate trade - more tariffs, more restrictions on immigration, and, in general, a call to go local

Updated On: 02 Jan 2026 | 7:51 AM IST

US tariffs, shifting metrics and the risks facing India's economy in 2026

As the US disrupts global trade and India pushes major trade deals, 2026 will test whether reforms, new economic measures and shifting geopolitics can sustain India's growth momentum

Updated On: 31 Dec 2025 | 10:48 PM IST

India inflation likely to remain low in 2026, new CPI series planned

Besides cooling food prices, the decision of the government to reduce GST rates on about 400 items in September helped in further improving the price situation in the country

Updated On: 30 Dec 2025 | 10:50 AM IST

Benign inflation may keep India's policy rates low for a long time: RBI Guv

India's inflation rate picked up in November from a record low in the previous month but stayed well below the central bank's 4% target

Updated On: 23 Dec 2025 | 9:56 PM IST

US core inflation unexpectedly eases to slowest pace since 2021

The report was complicated by the federal government shutdown, which prevented the BLS from collecting much of the October price data

Updated On: 19 Dec 2025 | 12:10 AM IST

ECB keeps interest rates steady, raises growth and inflation forecasts

The ECB now sees inflation at 1.9% in 2026, above its previous projection for 1.7% while 2027 inflation is projected at 1.8%, below the 1.9% seen in September

Updated On: 18 Dec 2025 | 9:59 PM IST

Bank of England cuts key interest rate to 3.75% amid easing inflation

Policymakers at Britain's central bank voted 5-4 to reduce the base rate by a quarter of a percentage point to 3.75% on Thursday, the lowest since February 2023

Updated On: 18 Dec 2025 | 6:57 PM IST

Japan weighs record 120 trillion yen budget as PM Takaichi fights inflation

If approved, the plan would cross the previous record 115.2 trillion yen initial budget that was cleared under former prime minister Shigeru Ishiba for fiscal 2025

Updated On: 17 Dec 2025 | 10:17 AM IST

WPI inflation remains in negative territory for 2nd month in a row in Nov

Inflation in manufactured products that carries weightage of over 64 per cent in the index, narrowed to a 14-month low of 1.33 per cent in November

Updated On: 15 Dec 2025 | 7:58 PM IST

A Goldilocks 2026: Can reforms sustain the growth-benign inflation mix?

India may see a goldilocks 2026 with strong growth and low inflation, but sustaining this balance will hinge on reforms, RBI policy support, fiscal consolidation and easing external pressures

Updated On: 15 Dec 2025 | 12:10 AM IST

Gold, silver rally to extend record run as traders eye inflation data

In the US, traders will also track non-farm payroll/ weekly jobless claims, housing data and consumer sentiments, which will also shape the direction of bullion prices, they added

Updated On: 14 Dec 2025 | 7:12 PM IST

Nominal GDP growth slowdown raises concerns despite strong real growth

Despite strong real growth, slowing nominal GDP and a sharply weaker deflator raise fiscal concerns, challenging Budget assumptions for FY26

Updated On: 04 Dec 2025 | 11:53 PM IST

Inflation targeting and Viksit Bharat at 2047: A framework for review

India's ill-conceived and hurriedly adopted inflation targeting is one such initiative that needs to be carefully evaluated

Updated On: 30 Nov 2025 | 11:17 PM IST