India Retail Inflation Rises to 3.21% in February 2026

India’s retail inflation, measured by the Consumer Price Index (CPI), increased to 3.21% in February 2026. The data was released by the National Statistics Office (NSO) under the Ministry of Statistics and Programme Implementation (MoSPI).

The inflation rate was 2.74% in January 2026, which means inflation rose by 47 basis points month-to-month.

The increase was mainly due to rising prices of:

• Food items such as tomato and cauliflower
• Precious metals like gold and silver
• Clothing and housing services

Food inflation rose significantly to 3.47% in February compared to 2.13% in January.

Inflation was slightly higher in rural areas (3.37%) than urban areas (3.02%).

This data is based on the new CPI series with base year 2024. The revised CPI includes around 358 items, reflecting updated consumption patterns based on the Household Consumption Expenditure Survey 2023–24.

The CPI data is very important because the Reserve Bank of India (RBI) uses it to decide monetary policy and interest rates.

India follows Flexible Inflation Targeting, where RBI aims to keep inflation around 4% with a tolerance band of 2–6%.

Despite the rise, the current inflation rate remains within this range, indicating controlled price pressures in the economy.

🎯 Exam Preparation Section

🔑 Key Points

• Retail inflation reached 3.21% in February 2026.
• Inflation rose 47 basis points from January 2026.
• Data released by National Statistics Office (NSO).
• Retail inflation measured using Consumer Price Index (CPI).
• Food inflation increased to 3.47%.
• Rural inflation 3.37%, Urban inflation 3.02%.
• New CPI series introduced with base year 2024.
• CPI basket expanded to 358 items.
• RBI monitors CPI to decide interest rate policy.

🧠 Concept Link (Very Important)

Consumer Price Index (CPI)

• CPI measures change in prices of goods and services consumed by households.
• It is the primary inflation indicator in India.
• Calculated monthly by the National Statistics Office (NSO).
• Used by RBI for monetary policy decisions.
• Based on a basket of consumer goods and services.
• Current CPI series uses 2024 as base year (2024 = 100).

❓ Practice Questions (MCQ)

1.Retail inflation in India is primarily measured using which index?

A) Wholesale Price Index
B) Consumer Price Index
C) Producer Price Index
D) GDP Deflator

Answer: B

2.India’s retail inflation in February 2026 was:

A) 2.21%
B) 2.74%
C) 3.21%
D) 4.10%

Answer: C

3.Retail inflation data in India is released by which organisation?

A) Reserve Bank of India
B) National Statistical Office
C) Finance Commission
D) NITI Aayog

Answer: B

4.The base year for the new Consumer Price Index series introduced in 2026 is:

A) 2011
B) 2015
C) 2020
D) 2024

Answer: D

5.RBI’s inflation tolerance band under flexible inflation targeting is:

A) 1%–4%
B) 2%–6%
C) 3%–7%
D) 4%–8%

Answer: B

📜 Previous Year Question (Similar Type)

Which index is used by the Reserve Bank of India for inflation targeting?

Answer: Consumer Price Index (CPI)

⚠️ Examiner Trap

Students often confuse CPI inflation with WPI inflation.
RBI uses CPI, not Wholesale Price Index (WPI), for monetary policy decisions.

🧭 Exam Tip

Examiners usually ask:

• Current inflation percentage
• Base year of CPI
• Institution releasing inflation data
• RBI inflation target range

🏷️ Topics Covered

Retail Inflation
Consumer Price Index
National Statistics Office
MoSPI
Monetary Policy
RBI Inflation Target
Food Inflation
Economic Indicators
Inflation Data
Indian Economy