India’s yearly retail inflation, based on the Consumer Price Index (CPI), increased to 3.40% in March 2026 from 3.21% the previous month. According to preliminary figures from the Ministry of Statistics and Programme Implementation (MoSPI) released on Monday, rural areas experienced inflation of 3.63%, higher than the urban rate of 3.11%. The Consumer Food Price Index (CFPI) also climbed to 3.87%.
Fuel and Food Categories Contribute to the Rise
The uptick in the overall figure was mainly due to increases in the fuel and lighting sector, along with ongoing pressures in food prices. This includes the effects of a ₹60 price increase for 14.2 kg domestic LPG cylinders and a ₹114.50 hike for commercial ones, effective March 7. Housing costs showed moderate inflation at 2.11%, while the personal care and miscellaneous items category surged to 18.65%, largely because of higher prices for gold and silver jewelry.
Central Bank Approach
Even with this slight increase, the 3.40% rate is under the Reserve Bank of India’s (RBI) 4% medium-term objective. In its latest policy update, the RBI kept the repo rate unchanged, emphasizing the importance of sustaining inflation near the 4% mark. Officials pointed out that despite fluctuations in global energy markets, adjustments to taxes have helped stabilize domestic fuel prices, keeping CPI within the 2-6% legal range.
