Synopsis: India’s retail inflation, measured by the Consumer Price Index, rose to 6.09% in October 2026 from 5.54% in September, the highest since October 2024 and above the RBI’s 6% upper tolerance limit. Food inflation climbed to 8.94% from 7.74%, led by a 116% rise in onion prices, according to MoSPI data released on 12 November. Economists now expect the RBI to follow its October rate hike with another 25 basis points at its December meeting.
India’s retail inflation rose to 6.09% in October 2026 from 5.54% in September, according to provisional data released by the Ministry of Statistics and Programme Implementation (MoSPI) on 12 November 2026. It is the highest reading since October 2024, when inflation stood at 6.21%.
The RBI’s inflation-targeting framework aims for CPI inflation of 4%, with a tolerance band of 2% to 6%. October’s print is above the upper end of that band, ahead of the central bank’s December monetary policy meeting.
Food prices drive the rise
Food inflation, measured by the Consumer Food Price Index, rose to 8.94% in October from 7.74% in September. The food and beverages division of the CPI recorded inflation of 8.51%. Onion prices recorded inflation of 116.22%, compared with 108.13% in September, while garlic, ginger and lemon rose 60.74%, 48.32% and 47.30% respectively.
Rural and urban inflation
Rural inflation increased to 6.63% in October from 6.08% in September. Urban inflation rose to 5.41% from 4.88%. Rural food inflation stood at 9.09%, while urban food inflation was 8.68%.
What to watch
MoSPI has said the October figures are provisional. The CPI data for November 2026 is due on 14 December 2026, or the next working day if that date is a holiday.
What it means for rates and markets
The October reading is above the RBI’s own projection of 6% for the October-December quarter and comes after the central bank raised its repo rate by 25 basis points in October, its first increase in about three years. October was also the twelfth straight monthly rise in annual inflation, which started from a very low base of 0.25% in October 2025.
According to media reports, ICRA projects inflation averaging about 6.2% in the current quarter, with risks tilted to the upside, and economists including DBS Bank’s Radhika Rao and CareEdge’s Rajani Sinha expect a second consecutive hike in December. For equity traders, the data points to rate-sensitive sectors such as banks, housing finance and real estate staying sensitive to the December policy decision, while onion and vegetable prices are the factor to track before the next CPI release.
Sources
- MoSPI: Press Release of CPI for October 2026
- DD News: Retail inflation rises to 6.09 percent in October
- Reserve Bank of India: monetary policy statements and press releases
Disclaimer: This article is for information purposes only and is not investment advice.
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