India’s CPI Inflation Hits 10-Month High of 3.2% in February 2026

Consumer Price Index (CPI) is used to measure the retail inflation in India. It tracks the prices of daily goods and services like food, housing, fuel, healthcare, and transport.

India’s retail inflation increased to 3.2% in February 2026 (from 2.74% in January), which is its highest level in ten months. But, even with this increase, it is still comfortably within the target range set by the Reserve Bank of India (RBI).

What Caused The Inflation To Rise?

Food prices played the biggest role in the rise in inflation during February. Vegetables and cereals saw noticeable price increases during the month. Inflation in the food and beverages category rose to 3.35% in February, up from 2.1% in January.

Food is the biggest component of the CPI calculation. Prices for these items depend a lot on things like the season of the year, the growth cycles of crops, and the cost of transportation. Even a small change in any of these factors can cause the overall inflation rate to go up.

What About Non-food Inflation?

Prices in the ‘paan, tobacco and intoxicants’ category also saw a marginal increase. The inflation in this segment rose to 3.5% in February from 2.9% in January.

Other sectors like personal care, social protection and miscellaneous goods & services stayed similar to the previous month. Inflation in this category rose slightly to 19.6% in February from 19.02% in January. This was mainly due to the higher prices of precious metals like gold and silver.

What Is Core Inflation?

Another important factor monitored by economists is known as core inflation. It excludes food and fuel prices. Because food and fuel prices can change quickly due to supply and logistics constraints, core inflation is often used to track longer-term trends.

Core inflation has remained stable during this period at 3.4%. This means that there is no extra pressure across the broader economy.

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What Lies Ahead?

Inflation data plays an important role in decisions regarding interest rates that are made by the Reserve Bank of India. Since the current inflation level is still within the target range, interest rates are likely to remain the same in the near future.

RBI’s projected inflation for FY26 stands at 2.1%. But experts say inflation could stay under pressure in March because of global uncertainty and a weaker rupee. Higher LPG cylinder prices in early March may also push up costs for fuel, restaurants, and accommodation. Along with rising gold prices, this could take overall CPI inflation to around 3.3%–3.5% in March 2026.

Sources:

ET

The Hindu