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Informist, Thursday, Feb. 12, 2026

 

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--CEA: Lower weight of food, beverage in CPI basket to lower inflation volatility 
--CEA: Inflation now could be driven more by core than food 
--CEA: Monetary policy response can focus on demand than supply pressures 
--CEA: Lower volatility can help anchor households' inflation expectations 
--CEA:Lower CPI volatility can aid predictability for Budget, fiscal numbers
--MoSPI secy: RBI to have more flexibility on calculating core inflation 
--CONTEXT: MoSPI secy briefs media post Jan CPI release with 2024 base yr 
--MoSPI secy: Next household consumption expenditure survey in 2028 
--Govt: Will soon release back series data on 2024 base yr till Jan 2013

 

NEW DELHI – India's retail inflation, which is set to experience reduced volatility in the new series with 2024 as the base year due to the lower weight of food in the CPI basket, will aid significantly in policymaking, according to Chief Economic Adviser to the Government V. Anantha Nageswaran. The statistics ministry Thursday released the CPI print for January, at 2.75%, with 2024 as the base year.

 

The ministry has cut the weight of food and beverages to 36.75% in the new series from 45.86% in the old series with 2012 as the base year. India's retail inflation has so far been prone to volatility due to volatile vegetable prices, a phenomenon attributable to supply constraints.

 

The Reserve Bank of India's Monetary Policy Committee, which manages demand-side inflation, anchors its policy decisions based on retail inflation. Now, lower volatility in the CPI print will help the committee focus better on demand, Nageswaran said while addressing the media on the new CPI series. The headline inflation would be driven more by core CPI--which excludes volatile components like food and usually includes prices of transport, communication, and household services--than food prices, he said.

 

Ministry of Statistics and Programme Implementation Secretary Saurabh Garg, who was also present at the briefing, said the RBI will have greater flexibility now in choosing components for core inflation. The statistics ministry does not outline the components for calculation of core inflation, Garg added.

 

Besides the RBI, the lower volatility in retail inflation will help the government with predictability in Budget and fiscal estimates, the CEA said. The lower volatility in retail inflation will also help in better anchoring household inflation expectations, he added.

 

The statistics ministry revised the base year for CPI after more than a decade. Going forward, it aims to undertake the revision every five years. The new series is based on data from the Household Consumption Expenditure Survey of 2023-24. The ministry will conduct the next survey in 2028, Garg said. The previous CPI series was based on the Household Consumption Expenditure Survey of 2011-12.

 

The ministry will also release the CPI print based on the new series until January 2013. The back series will be available on the ministry's portal, Deepti Srivastava, deputy director general in the ministry, said.  End

 

Reported by Krity Ambey

Edited by Rajeev Pai

 

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