What’s Driving the Recent Rise in India’s Retail Inflation?

India's retail inflation has seen a slight increase to 3.48% in April, primarily due to rising food prices. The National Statistics Organisation reports a food inflation rate of 4.2%. With projections from the Reserve Bank indicating potential risks from elevated energy prices and climate conditions, this article delves into the implications of these trends for the Indian economy. Discover how these factors could shape inflation in the coming months.

By Narendra Chaudhary May 12, 2026, 16:52 IST

Retail Inflation Sees a Slight Increase

New Delhi: In April, retail inflation edged up to 3.48%, a slight increase from 3.40% in March, primarily driven by rising food prices.

According to the Consumer Price Index (CPI), food inflation was recorded at 4.2% last month, compared to 3.87% the previous month.

The year-on-year inflation rate, based on the All India Consumer Price Index (CPI) with a base year of 2024 for April, stood at 3.48%, as reported by the National Statistics Organisation (NSO).

Inflation rates for rural and urban areas were noted at 3.74% and 3.16%, respectively.

Recently, the Reserve Bank projected the CPI inflation for the fiscal year 2026-27 to be around 4.6%, with an expected 4% in the first quarter. The bank also highlighted that ongoing high energy prices, influenced by the conflict in West Asia, along with potential El Nino conditions, could pose additional risks to inflation.