How is inflation measured in India?

India primarily measures retail inflation using the Consumer Price Index (CPI), specifically CPI (Combined). This index tracks the average change over time in the prices paid by urban and rural consumers for a basket of consumer goods and services.

Who releases India's inflation data?

The National Statistical Office (NSO), under the Ministry of Statistics and Programme Implementation (MoSPI), Government of India, releases the monthly Consumer Price Index (CPI) data.

What is the Reserve Bank of India's (RBI) role concerning inflation?

The RBI's primary mandate, as part of its monetary policy framework, is to maintain price stability. It targets retail inflation at 4% with a tolerance band of +/- 2% (2-6%), using tools like interest rate adjustments to achieve this.

How does high inflation affect the Indian economy?

High inflation erodes purchasing power, reduces savings, increases the cost of living for households, and can deter investment. It also creates uncertainty, potentially slowing economic growth and impacting financial market stability.