India's inflation rate rises to 3.21% in February

India's inflation rate rose in February even before the full impact of the Iran war shows on the world's fourth largest economy.

India's inflation rate rose in February even before the full impact of the Iran war shows on the world's fourth largest economy.

The Consumer Price Index (CPI), a measure of retail inflation, rose to 3.21% last month as against a revised 2.74% in January, according to government data on Thursday. That compares with the Reserve Bank of India's estimate of 2.1% in FY26, 4% in Q1 FY27 and 4.2% in Q2 FY27.

A surge in crude oil prices, courtesy the escalating Iran war, is likely to weigh on New Delhi's inflation math as India imports 85% of its energy needs. According to CLSA, every 10% increase in crude oil prices raises retail inflation by 40 to 60 basis points. One basis point is one-hundredth of a percentage point.