The expert group, constituted by the Ministry of Statistics and Programme Implementation (MoSPI) for base revision of CPI, outlines enhancements and modifications introduced in the new CPI series i.e. in CPI 2024.
About CPI
- CPI track changes over time in the general retail prices of a basket of goods and services purchased by households for consumption.
- Compilation: It is compiled by MoSPI every month for rural, urban and combined sectors.
- Formula: For compiling CPI, Laspeyre’s Index Formula is used, which is based on three elements – Base Year Price, Base Year Weights, and Current Month’s Price.
- Usage: Primary indicator for RBI for formulating monetary policies, used as deflator to adjust nominal GDP to real GDP, indexation of wages or contracts, and adjusting social security payments etc.
