Retail inflation rises to 2.75% in January; MoSPI rolls out new CPI series with 2024 base year

CPI Inflation: India’s year-on-year retail inflation, measured by the Consumer Price Index (CPI) with the revised base year of 2024, stood at 2.75 per cent in January 2026, compared with January 2025, according to data released by the Ministry of Statistics and Programme Implementation (MoSPI) on Thursday.

Inflation levels were broadly similar across regions, with rural inflation recorded at 2.73 per cent and urban inflation at 2.77 per cent during the month.

Food and housing inflation trends

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The year-on-year inflation rate based on the All India Consumer Food Price Index (CFPI) came in at 2.13 per cent (provisional) in January. Rural food inflation stood at 1.96 per cent, while urban food inflation was higher at 2.44 per cent.

Food prices showed mixed trends during the month. Prices of vegetables such as potatoes, onions and garlic declined, along with pulses including arhar and tur. In contrast, tomato prices registered an increase, partly offsetting the overall easing in food inflation.

Housing inflation for January was estimated at 2.05 per cent (provisional). Rural housing inflation stood at 2.39 per cent, while urban housing inflation was recorded at 1.92 per cent. Notably, the latest data includes rural house rent for the first time, a move aimed at improving the coverage of housing consumption in rural areas.

The data also pointed to a sharp rise in inflation for silver jewellery, which surged 159.67 per cent, while gold jewellery inflation rose 46.77 per cent during the period.

CPI base year revised to 2024

The CPI base year has been revised from 2012 to 2024, using data from the Household Consumption Expenditure Survey (HCES) 2023–24. The new CPI series (Base 2024=100) has been introduced to ensure that inflation measurement reflects current household consumption patterns, price structures and structural changes in the Indian economy.

MoSPI said the earlier CPI series with base year 2012 had served as a stable and reliable inflation gauge for more than a decade. However, significant changes have taken place since then, including shifts in consumption behaviour, rising incomes, urbanisation, expansion of the services sector and increased digitalisation.

Under the revised framework, consumption classification now follows the Classification of Individual Consumption According to Purpose (COICOP) 2018, expanding the structure to 12 divisions from the earlier six groups.

According to MoSPI, the revision enhances the coverage, granularity and representativeness of inflation data, providing better inputs for policymakers, financial institutions, businesses and citizens.

Data modernisation and AI use

Earlier, speaking to ANI, MoSPI Secretary Saurabh Garg said that updating base years for key macroeconomic indicators such as GDP, CPI inflation and the Index of Industrial Production (IIP) would significantly improve data quality and usability for artificial intelligence (AI) and machine learning applications.

“It is extremely important to update base years because the structure of the economy changes over time, new data sources become available, and methodologies of data collection also evolve,” Garg said.

The government had constituted an Expert Group on CPI base revision, comprising representatives from the Reserve Bank of India, academia, line ministries and statistical experts, to guide the transition to guide the transition to the new series.