India CPI inflation at 3.21% in Feb 2026, 11-month high

CPI inflation picks up after late-2025 lows

India’s consumer price index (CPI) inflation rose to 3.21% year-on-year in February 2026, up from 2.74% in January. The print was loosely in line with market expectations of around 3.1% and marked the fastest pace in 11 months, according to the data referenced from the Ministry of Statistics and Programme Implementation (MOSPI).

The February rise follows a period of softer readings late last year, when a pullback in food prices pushed the headline rate toward record lows. The latest number suggests inflation is normalising from those unusually low levels, with food prices once again contributing more meaningfully to the headline rate.

Food inflation moves higher

Food inflation rose to 3.47% in February from 2.13% in January. Given that food and beverages carry 45.86% weight in India’s CPI basket, even modest swings in food prices can materially move the headline inflation rate.

MOSPI’s CPI structure highlights why food often dominates the inflation narrative. Within the food and beverages group, large sub-categories include cereals and products (9.67%), milk and products (6.61%), and vegetables (6.04%), along with prepared meals, snacks and sweets.

Services and discretionary categories show firm price trends

Beyond food, several categories recorded steady year-on-year increases. Prices rose for:

• Restaurants and accommodation: 2.73%
• Clothing and footwear: 2.81%
• Paan and tobacco: 3.49%

Alongside these category inflation prints, component index readings also edged up month-on-month. For example, CPI clothing and footwear increased to 106.11 points in February 2026 from 105.92 points in the prior period, while CPI education services moved to 105.36 points from 105.33 points.

Transport inflation turns slightly negative

Transport prices fell -0.05% year-on-year in February. The decline was linked to a pullback in oil and gas costs in the wholesale market, as described in the provided context.

The same context also flagged that wholesale oil and gas costs were expected to rise in March due to the war in the Persian Gulf. The February transport number, however, reflects conditions prevailing during the reference period and shows that energy-linked relief still existed at the retail level in February.

Month-on-month CPI change remains mild

On a sequential basis, CPI rose 0.11% month-on-month in February. The small monthly increase suggests the sharp rise in the year-on-year figure was influenced partly by the base effect from last year’s prices, alongside the February firming in food inflation.

Monthly CPI moves can be volatile in categories such as food, and the February change was modest compared with swings typically seen during periods of supply disruption.

Wholesale inflation also accelerates in February

India’s wholesale price inflation, measured by the Wholesale Price Index (WPI), rose to 2.13% year-on-year in February 2026, up from 1.81% in January and above expectations of 2.0%, as per the Office of the Economic Advisor’s referenced data.

The February acceleration was attributed to a pickup in primary articles inflation (3.27% vs 2.21% in January). Within this, food articles inflation rose to 2.19% from 1.55%. Non-food articles inflation also accelerated to 8.80% from 4.97%, driven by a jump in oilseed prices (25.38% vs 0.11%).

In contrast, fuel and power remained in deflation at -3.78% year-on-year (versus -4.01% in January), reflecting continued declines in items such as LPG, petrol, and high-speed diesel (HSD). On a monthly basis, wholesale prices rose 0.25%.

ICRA flags risk of higher WPI inflation in March

A separate report cited from ICRA said WPI inflation is expected to rise to a 21-month high of 3.2% in March 2026, driven by rising food and commodity prices. The report pointed to higher global commodity prices including crude oil, natural gas, and edible oils, and noted that movements in the USD/INR pair can add to pressure due to India’s import dependence.

ICRA also highlighted the WPI basket’s exposure to fuel items, stating that fuel items (crude oil, natural gas, and derivatives) have a 10.4% weight. It estimated that for every 10% increase in crude oil prices, WPI inflation could rise by 80-100 basis points.

CPI and WPI weights explain why trends can diverge

CPI and WPI respond to different drivers because they measure different baskets and weights. In CPI, household consumption categories such as food dominate the index, while WPI is structured around goods at the wholesale level.

In WPI, the basket is divided into Primary Articles (22.6%), Fuel and Power (13.2%), and Manufactured Products (64.2%). This means a jump in industrial inputs, oilseeds, or manufacturing costs can lift WPI even when some retail services remain stable.

Key numbers at a glance

Market impact and what investors track next

For markets, the February CPI reading reinforces that inflation has moved off late-2025 lows, with food again playing a central role. The transport component, which slipped slightly into negative territory, points to the importance of energy pricing as a counterweight when food inflation rises.

The combination of firming CPI and rising WPI can keep focus on input costs, especially where wholesale pressures risk feeding into retail pricing over time. With the context pointing to geopolitical risks around oil and gas costs in March, future prints on fuel-linked categories will remain important data points.

Outlook markers from external forecasts

Trading Economics cited expectations for India’s inflation rate of 3.40% by the end of the quarter, and projections of around 4.00% in 2027 and 4.10% in 2028, based on its models and analyst expectations. These are not official forecasts, but they provide a reference range that some investors monitor alongside MOSPI and WPI releases.

Conclusion

India’s February 2026 CPI inflation rose to 3.21%, driven largely by a pickup in food inflation to 3.47%, while transport inflation stayed marginally negative at -0.05%. Wholesale inflation also strengthened in February to 2.13%, and ICRA expects a further rise in WPI inflation to 3.2% in March amid commodity-linked pressures. The next set of inflation prints will be watched for how food and energy trends evolve.