The average annual retail inflation for April-December of the current fiscal year would be 1.83% under the new consumer price index (CPI) series, just 11 basis points higher than measured under the old series.
The old series used 2012 as the base year, while the new one, released on Thursday, has an updated base year of 2024. Also, the new CPI covers a higher number of consumer goods, with significant differences in item weighting.
The Ministry of Statistics and Programme Implementation (MoSPI) released the revised CPI series on Thursday, along with January headline print, which stood at 2.75% Y-o-Y.
Deciphering the Shift
Core inflation, excluding food and fuel, was computed by economists to be in the range of 3.2-3.4% for January under the new series, compared with 4.5% for December 2025 and 3.7% for January 2025, under the old series. According to economists, the decline in core inflation is mainly due to the change in weighting of gold, which declined to 0.62% in 2024 series, compared to 1.08% in 2012 series.
“It is also encouraging to see that housing inflation – which is now being computed differently in the new series (removing employer provided rent) and calculated for rural areas as well – remained broadly moderate at 2.1% in January. The overall core inflation prints signals that underlying inflationary pressures remain moderate,” Sakshi Gupta, Principal Economist at HDFC Bank said.
Modernizing the Basket
The new series shows broadly comparable monthly inflation readings during the same period, with October and November particularly low (0.08% and 0.5%, respectively), before rising modestly in December (1.15%). The Reserve Bank of India (RBI) during the February Monetary Policy Committee (MPC) meeting revised its inflation forecast upward to 2.1% for 2025–2026 from 2% earlier.
Analysts note that differences between the old and new CPI series typically arise from variations in basket composition, weighting of items (particularly food and fuel), and base-year updating. The new series is generally viewed as more representative of contemporary consumption patterns. Overall, the data indicate that inflation has remained benign through the first three quarters of FY26 under both methodologies, with only marginal discrepancies between the old and new series so far.