What is Inflation

Inflation

About Inflation

What is Inflation

Inflation can be defined as a persistent rise in the general price of goods and services of common or daily use — such as clothing, food, fuel, transport, etc — which results in an increase in the cost of living.
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Inflation is the measure of change in average price of services and commodities, done at regular intervals. It indicates a decrease in the purchasing power of a unit of a nation’s currency as the products and services get more expensive. Basically, inflation is the difference between aggregate demand and aggregate supply of goods and services. When aggregate demand exceeds the supply of goods at current prices, there is a rise in the price level.
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A certain level of inflation is required in the economy to ensure that expenditure is promoted and money hoarding through savings is discouraged.
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How is inflation measured?
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In India, there are two main sets of inflation indices to measure changes in price levels — Consumer Price Index (CPI) and Wholesale Price Index (WPI). These indices measure changes at the retail and wholesale price levels, respectively. CPI tracks any shift in retail prices of essential and daily goods and services consumed by households across the country. In short, it captures changes in price level at the consumer level.
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WPI, on the other hand, is the average change in the price of commodities at the wholesale level. It considers the price of goods traded among corporations, not goods purchased by consumers. The aim of WPI is to monitor price drifts that reflect demand and supply in manufacturing, industry and construction.?
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Latest Updates on Inflation

Stubbornly high food prices slowing drop in inflation to 4%: RBI bulletin

2 min read Last Updated :Mar 19 2024 | 5:13 PM IST
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Indian govt bond yield at more than two-week high as US peers jump

2 min read Last Updated :Mar 18 2024 | 11:06 AM IST
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What soft landing?

5 min read Last Updated :Mar 15 2024 | 11:27 PM IST
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Inflationary pressure signals weakening support for Asian bond gains

3 min read Last Updated :Mar 14 2024 | 8:16 AM IST
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Unemployment, inflation, 'bhagidari' crucial issues for country: Rahul

2 min read Last Updated :Mar 13 2024 | 1:28 PM IST
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Govt bond yields seen higher tracking US peers on inflation uptick

3 min read Last Updated :Mar 13 2024 | 10:17 AM IST
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Medical inflation driving up ticket sizes for retail health insurers

4 min read Last Updated :Mar 12 2024 | 11:45 PM IST
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US inflation tops Feb forecasts, reinforcing Fed's cautious approach

4 min read Last Updated :Mar 12 2024 | 10:12 PM IST
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JPMorgan's CEO urges US Fed to wait past June before cutting rates

3 min read Last Updated :Mar 12 2024 | 9:25 AM IST
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China's consumer prices up first time in 6 months on Lunar New Year gains

3 min read Last Updated :Mar 09 2024 | 4:13 PM IST
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ECB keeps rate unchanged at 4%, may cut in June with 2% inflation in sight

4 min read Last Updated :Mar 07 2024 | 10:39 PM IST
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Feb consumer price inflation forecast to edge down to 4-month low: Poll

3 min read Last Updated :Mar 07 2024 | 7:57 PM IST
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Key issues like unemployment, inflation find no place in media: Rahul

3 min read Last Updated :Mar 04 2024 | 5:49 PM IST
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At 4.3% in FY25, inflation may head lower than RBI forecast, estimates CMIE

3 min read Last Updated :Mar 04 2024 | 1:50 PM IST
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Markets hit fresh highs as bulls rejoice GDP boost; Sensex up 1.7%

4 min read Last Updated :Mar 01 2024 | 11:31 PM IST
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European inflation eases to 2.6% on falling energy prices, food inflation

2 min read Last Updated :Mar 01 2024 | 4:15 PM IST
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Bitcoin barrels to best month since 2020, Wall Street points up after PCE

5 min read Last Updated :Feb 29 2024 | 9:50 PM IST
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US inflation increases in line with June interest rate cut expectations

3 min read Last Updated :Feb 29 2024 | 8:29 PM IST
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World economy has growing chance of pulling off soft landing: G20

3 min read Last Updated :Feb 27 2024 | 11:36 PM IST
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Indian economy still growing below its potential, says Jayanth R Varma

3 min read Last Updated :Feb 23 2024 | 11:13 PM IST
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