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Q147 (UPPCS/2021) Economy › Money, Banking & Inflation

Headline inflation refers to the change in value of all goods on the basket. On which basis is the headline inflation measured ?

Result
Your answer: —  Â·  Correct: C

Explanation

Headline inflation is the measure of total inflation within an economy, including volatile items like food and energy. In the Indian context, headline inflation is measured using the Combined Consumer Price Index (CPI). Following the recommendations of the Urjit Patel Committee, the Reserve Bank of India (RBI) officially adopted CPI (Combined) as its primary anchor for monetary policy in April 2014, moving away from the Wholesale Price Index (WPI). While WPI measures price changes at the producer level, CPI reflects the actual cost of living for the final consumer. The CPI (Combined) is a weighted average of CPI (Rural) and CPI (Urban), published monthly by the National Statistical Office (NSO) to provide a comprehensive view of price stability across the country.

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