Why is the food weight in India's new CPI series reduced?

The food and beverage weight is reduced to 36.7% in the new CPI series to more accurately reflect current household consumption behaviors.

What is the goal of India's CPI revision?

The goal is to align with international standards, redistribute weights, and capture genuine changes in consumer spending patterns.

Will the reduced food weight affect inflation volatility in India?

According to MoSPI Secretary Saurabh Garg, the reduced food weight is not expected to affect inflation volatility.

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New CPI Series: Reflecting Real Consumption Shifts

9 Feb

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Summary

New CPI series lowers food weight to 36.7% to mirror consumption.
Revision aligns with international standards for accuracy.
Weight redistribution aims to capture genuine economic changes.

New CPI Series: Reflecting Real Consumption Shifts

The new Consumer Price Index (CPI) series in India will see a significant adjustment in its weightage for food and beverages, reducing it to 36.7%. This change, according to MoSPI Secretary Saurabh Garg, is designed to more accurately represent contemporary household consumption behaviors. The revision adheres to international statistical standards.

This recalibration involves a redistribution of weights within the index. The objective is to ensure that the CPI captures the actual shifts in consumer spending. Officials have stated that this revision is not expected to introduce greater volatility into inflation measurements, promising a more accurate reflection of economic reality.

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