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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

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

Delhi's inflation stays below national average in 2024-25: Govt report

The report prepared by the Directorate of Economics and Statistics of the Delhi government, however, showed that the inflation rate rose in the food & beverages and housing sectors

Updated On: 28 Nov 2025 | 7:03 PM IST

New GST rates help cut Oct inflation by 85 bps to record low 0.25%: Experts

The Consumer Price Index- (CPI-) based retail inflation was lowest in the current series (base year 2012), which captures data since January 2014

Updated On: 13 Nov 2025 | 7:04 PM IST

Inflation data, Q2 earnings, global trends to drive stock markets this week

In a holiday-shortened last week, the BSE benchmark tanked 722.43 points or 0.86 per cent, and the NSE Nifty declined 229.8 points or 0.89 per cent

Updated On: 09 Nov 2025 | 11:02 AM IST

Competition, rains drag services activity to 5-month low in October

India's services PMI slipped to 58.9 in October, a five-month low, as competition and rains slowed growth even as demand and GST relief supported business optimism

Updated On: 06 Nov 2025 | 11:11 PM IST

BS BFSI Summit: 'Inflation-targeting worked, no major revamp required'

At BS BFSI Insight Summit 2025, a high-level panel of economists said that flexible inflation targeting has largely worked in keeping inflation under control and no major revamp is required

Updated On: 30 Oct 2025 | 12:28 AM IST

US inflation stays elevated but prices rose less than feared last month

Consumer prices increased 3% in September from a year earlier, the Labour Department said Friday, up from 2.9% in August

Updated On: 24 Oct 2025 | 9:50 PM IST

Wall Street hits record highs as cool inflation fuels Fed rate cut hopes

The Fed is set to cut rates by 25 basis points in its policy meeting scheduled on October 29

Updated On: 24 Oct 2025 | 9:33 PM IST

Martin Kocher advocates for ECB calm with policy in a 'good place'

ECB officials have largely indicated that - after eight interest-rate cuts in a year - they are happy with current policy settings, though some are still saying further cuts shouldn't be excluded

Updated On: 17 Oct 2025 | 12:21 AM IST

India's wholesale inflation cools to 0.13% in Sep against 0.52% in Aug

September 2025 WPI-based inflation: The positive rate of inflation in September is primarily due to an increase in prices of manufacturing of food products

Updated On: 14 Oct 2025 | 12:06 PM IST

India's retail inflation slips to 99-month low of 1.54% in September

Inflation stood at 5.5 per cent in September 2024, with food prices rising over 9.2 per cent

Updated On: 13 Oct 2025 | 11:16 PM IST

September retail inflation eases to 1.54%, food inflation down at -2.28%

September CPI-based inflation: The inflation dipped in September after an increase in August that marked the first monthly rise in inflation in 10 months

Updated On: 13 Oct 2025 | 4:39 PM IST

Slower growth, under-target inflation will prompt another rate cut: BMI

BMI added that the central bank's growth and inflation forecasts for FY26 are too high, pointing to it as one of the main reasons behind the possible cuts

Updated On: 02 Oct 2025 | 12:18 PM IST

The wisdom of waiting: Why RBI held back despite inflation plunging

With inflation easing to 2.6%, RBI opts for caution, saving rate cuts for later

Updated On: 02 Oct 2025 | 6:32 AM IST

Best of BS Opinion: GST 2.0 reforms miss underlying core principles

Today's pieces look at the available space for more rate cuts, the sorry state of tribunals, why GST reforms are not really that, and how India can harness its vast non-export MSME sector

Updated On: 29 Sep 2025 | 6:15 AM IST

RBI may cut rates by 25 bps as inflation stays benign: SBI Research

The RBI reduced the key short-term lending rate (repo) by 100 basis points in three tranches beginning in February, amidst declining consumer price index (CPI) based inflation

Updated On: 28 Sep 2025 | 3:37 PM IST

Stock Market Highlights: Sensex snaps 3-day winning run, ends 388pts down; IT, FMCG dip; PSBs rally

Stock Market highlights on September 19: Sectorally, the Nifty PSU Bank index outperformed, closing with gains of 1.28 per cent

Updated On: 19 Sep 2025 | 3:51 PM IST

BoE holds main UK interest rate at 4% with inflation above target

The decision was widely anticipated, as was the split of votes on the nine-member Monetary Policy Committee

Updated On: 18 Sep 2025 | 6:37 PM IST

India's wholesale inflation at 0.52% in August as food prices increase

August 2025 WPI-based inflation: The positive rate of inflation in August is primarily due to an increase in the prices of food products

Updated On: 15 Sep 2025 | 12:39 PM IST