New CPI Series To Better Capture Consumption & Cut Volatility: RBI Governor

ENA Sectors 2026-02-24 17:06:11 New Delhi, Feb 24 (KNN) Reserve Bank of India (RBI) Governor Sanjay Malhotra on Monday said the new Consumer Price Index (CPI) series, based on 2024 prices, will better capture household consumption patterns and reduce volatility, leading to more accurate inflation estimates. He was speaking after the post-Budget meeting of the RBI Central Board with Finance Minister Nirmala Sitharaman, PTI reported. Data released on February 12 showed retail inflation at 2.75 per cent in January under the new series, which uses 2024 as the base year. The revised index, issued by the Ministry of Statistics and Programme Implementation, expands coverage to 358 items from 299 earlier. Headline inflation in January — the first month under the new series — stood above the lower end of the RBIs 2 6 per cent tolerance band for the first time since June 2025. Inflation averaged 2.2 per cent in 2025 under both the old and new series. Target Under Review Malhotra said changes in methodology could affect projections, and the April monetary policy will reflect the revised framework. However, he noted that the inflation target may not change merely because of the change in CPI series. Next estimate that we give out in the April policy will certainly take into account all the changes that are being brought in, he added. Under Indias monetary policy framework, the government, in consultation with the RBI, sets a 4 per cent CPI inflation target with a tolerance band of 2 6 per cent for five-year periods. The current target runs from April 1, 2021, to March 31, 2026. The RBI has submitted its recommendations for the next term, effective April 1, 2026, and the proposal is under government review. The government will very quickly be coming out with the target, Malhotra said. On US Securities Holdings Responding to questions on a moderation in US securities reserves, Malhotra noted, There is no conscious call to reduce our holdings in the US securities. I think what you are referring to is the increase in gold holdings because of changes in valuations . The US dollar has, as you are aware, weakened. So, most of the changes that you have seen are because of changes in valuation, he added. (KNN Bureau) 45267 https://knnindia.co.in/news/newsdetails/sectors/new-cpi-series-to-better-capture-consumption-cut-volatility-rbi-governor 2026-02-24 17:06:11 knnindia.co.in New CPI Series To Better Capture Consumption & Cut Volatility: RBI Governor