We all can work out our basic expenses based on how much we spend currently, but to plan for the future, we need to factor in inflation or the rate of price increase. On the face of it, India experiences a modest inflation. But that perception is quite misleading because India is possibly one of the few economies where policymakers focus on the wholesale price index rather than consumer prices.
This is why even when headline inflation figures slipped into the negative zone a few months ago, prices of essential commodities and the cost of living never really fell. In fact, it rose in line with retail inflation, which was much higher at 12%.
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We all can work out our basic expenses based on how much we spend currently, but to plan for the future, we need to factor in inflation or the
rate of price increase. On the face of it, India experiences a modest inflation. But that perception is quite misleading because India is possibly one of the few economies where policymakers focus on the wholesale price index rather than consumer prices. This is why even when headline inflation figures slipped into the negative zone a few months ago, prices of essential commodities and the cost of living never really fell. In fact, it rose in line with retail inflation, which was much higher at 12%. |
