Economy · 14 Aug 2026

core inflation headline inflation India 2026

Consider the following statements regarding India's inflation data for July 2026:

  1. Headline retail (CPI) inflation rose to 4.45%, a 19-month high, while core inflation (excluding food and fuel) held nearly steady at around 3.9%.
  2. The RBI's Monetary Policy Committee raised the repo rate at its August 2026 meeting in response to headline inflation breaching its 4% target.
  3. Ginger prices recorded a year-on-year increase of over 80%, even as potato and tomato prices declined.
A1 only
B1 and 3 only
C2 only
D1, 2 and 3
This question is based on: An 83% Spike in Ginger Prices No Interest Rate Can Touch
Take this in full test mode → Instructions for 14 Aug 2026
About this question

Why in news

MoSPI released July 2026 CPI data showing headline inflation at a 19-month high, the same week the RBI's Monetary Policy Committee decided to leave the repo rate unchanged at 5.25%.

Why for UPSC

This tests whether a candidate correctly reads a monetary-policy news cycle rather than assuming "high inflation → rate hike" by default - the RBI's actual decision (hold, not raise) is the kind of specific factual detail UPSC likes to isolate.

Prelims summary

India's July 2026 headline CPI hit a 19-month high of 4.45%, driven by supply-side spikes in items like ginger (+83.62% YoY), even as core inflation stayed near 3.9%. The RBI held the repo rate steady at 5.25%, judging the shock to be supply-driven and outside the reach of demand-side monetary tools.

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