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SBI Research: Revised Food Weights In CPI-IW Reaffirm Our Contention Of Rebasing Headline CPI 

SBI Research: Revised Food Weights In CPI-IW Reaffirm Our Contention Of Rebasing Headline CPI

A vendor displays different varieties of pulses in a store at the Kondli Wholesale Market in Noida, Uttar Pradesh, India. (Photographer: Prashanth Vishwanathan/Bloomberg)
A vendor displays different varieties of pulses in a store at the Kondli Wholesale Market in Noida, Uttar Pradesh, India. (Photographer: Prashanth Vishwanathan/Bloomberg)

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SBI Research Report

With the recent changes in Consumer Price Index for industrial workers, we again raise questions on the validity of continuing with existing weights in headline CPI.

The weighting pattern of food items in CPI at 45.86% is based on 2011-12 Consumer Expenditure Survey (CES).

This is already significantly different from the share of food and beverages (30%) in the Private Final Consumption Expenditure (PFCE), published by the National Account Statistics (NAS).

Against such a backdrop, we again reiterate there is urgent need to rationalise the weights under CPI.

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SBI Research Ecowrap 231020.pdf

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