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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

West Asia crisis: Supply woes could trigger demand shock, says RBI Bulletin

War, weak monsoon raise upside risks to inflation

Updated On: 24 Apr 2026 | 12:00 AM IST

External debt and inflation within target: RBI governor Sanjay Malhotra

Malhotra further highlighted India's continued commitment to regulatory reforms and enhanced ease of access and operations for foreign investors

Updated On: 23 Apr 2026 | 10:59 PM IST

India fiscal deficit may breach target, rise to 4.5% in FY27: BMI

Fitch warns India's fiscal deficit may exceed the FY27 target due to higher subsidies and policy support, while Moody's sees rising inflation and unemployment risks

Updated On: 23 Apr 2026 | 12:12 AM IST

Margin concerns and high valuations may cap gains for Nestle India

Nestle India reported strong Q4 growth, but rising raw material costs, sustained ad spends and high valuations may limit upside despite volume-led gains

Updated On: 22 Apr 2026 | 11:59 PM IST

India can sustain growth despite crude at $90-100 per barrel: Assocham

India can sustain economic growth despite crude prices in the $90-100 per barrel range, supported by strong consumption, infrastructure spending and macroeconomic resilience

Updated On: 22 Apr 2026 | 6:48 PM IST

India's unemployment to tick up, inflation to rise in 2026: Moody's

Moody's Analytics projects India's unemployment rate to edge up to 7 per cent in 2026, while inflation may rise to 4.5 per cent, the highest among Asia-Pacific peers

Updated On: 22 Apr 2026 | 4:42 PM IST

UK inflation rises to 3.3% in March as Iran war impact begins to hit

The British central bank is expected to keep borrowing costs on hold on April 30 at the end of its next scheduled Monetary Policy Committee meeting

Updated On: 22 Apr 2026 | 12:10 PM IST

Second-round effects of supply shocks a real concern, says RBI governor

Forex intervention as needed; not committing to indefensible peg: Malhotra

Updated On: 20 Apr 2026 | 10:50 PM IST

'Iran war may be as disruptive for India as Covid; long-term impact likely'

Although the government is sticking to its forecasts of 6.8 per cent-7.2 per cent for the fiscal year through March 2027, several economists have already started to downgrade their projections

Updated On: 16 Apr 2026 | 9:41 AM IST

Fuel pushes March wholesale inflation to 3.88%; highest in 41 months

The increased rate of inflation in March was primarily due to a jump in prices of crude petroleum & natural gas, other manufacturing, non-food articles, manufacture of basic metals and food articles

Updated On: 15 Apr 2026 | 12:28 PM IST

IMF lifts India FY27 growth to 6.5% as lower US tariffs offset risks

IMF has raised India's FY27 growth forecast to 6.5 per cent, saying lower US tariffs could offset the impact of West Asia tensions even as global growth and trade outlook weaken

Updated On: 14 Apr 2026 | 11:57 PM IST

Crude oil prices at $130 could unsettle growth outlook: S&P Global

S&P Global says crude at $130 per barrel could slow India's growth, widen fiscal deficit, raise inflation and strain corporate and banking sector performance

Updated On: 14 Apr 2026 | 11:37 PM IST

Policy challenge: Oil shocks and monsoon risks cloud India's outlook

The brunt of the war and persistent geopolitical tensions could vary across countries, with economies dependent on imported energy likely to face a greater impact

Updated On: 14 Apr 2026 | 9:41 PM IST

Gold falls as US blockade of Strait of Hormuz raises inflationary risks

Bullion fell as much as 2.2 per cent to dip below $4,650 an ounce in early trading, before paring losses

Updated On: 13 Apr 2026 | 8:36 AM IST

India's high valuation premium to other EMs won't return easily: Amish Shah

Shah said any further market upside is likely to be earnings-led rather than driven by valuation expansion

Updated On: 06 Apr 2026 | 10:09 PM IST

Rising yields, inflation to keep FY27 corporate bond issuances subdued

Corporate bond issuances likely to remain subdued in FY27 as elevated yields, inflation risks and liquidity conditions weigh on fundraising activity and investor appetite

Updated On: 03 Apr 2026 | 11:23 PM IST

Crude sustaining above $100 will push inflation beyond 6%, says HSBC

Amid speculation ahead of next Wednesday's monetary policy announcement on whether the RBI uses interest rates to defend the rupee, the report suggested risks of such a move

Updated On: 03 Apr 2026 | 6:26 PM IST

Best of BS Opinion: All eyes on RBI's policy meeting amid Iran conflict

From Sebi's governance gaps and inflation targeting to investor protection concerns, AI-led consumer insights, and evolving global discourse, today's BS Opinion offers sharp perspectives

Updated On: 31 Mar 2026 | 6:15 AM IST

Inflation dynamics: Ongoing Iran conflict will complicate policy choices

Research has shown that both the inflation rate and volatility moderated after the adoption of the flexible inflation-targeting framework

Updated On: 30 Mar 2026 | 10:39 PM IST

First time in this rate cycle, RBI faces growth-inflation dilemma

The going was good until war in West Asia started. The inflation rate was low with growth staying robust

Updated On: 29 Mar 2026 | 11:02 PM IST