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Inflation BY AYUSSH SANGHI How to measure Inflation and Analysis? - Part 4.11
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New CPI Indices . Policy makers have gradually shifted from CPI (Old) indices to the use of CPI for measuring inflation in conformity with the global practice. In this regard, a new CPI was launched in February 2011 called CPI (New) with base year 2010.
New CPI Indices . CPI (New) is the average of CPI (Rural) and CPI (Urban), which is also prepared separately. Hence we have 3 new indices CPI (Urban) CPI (Rural) CPI (Combined)
Analysis of Inflation in India Analysis of Inflation in In . India's inflation has the following charateristics: structural and monetary phenomenon
Analysis of Inflation in India - In the Short Term The localised demand - supply imbalances are seen in wage goods, often due to seasonal variations in production - coupled with market rigidities and regulatory failures have supported inflationary expectations that have resulted in a more widespread impact on the consumers than the initial inflationary impulse
Analysis of Inflation in India - In the Medium/Long Run The movement and outcome of monetary aggregates such as the money supply and interest rates of the financial system have influenced aggregate demand and consequently changes in price levels in the economy. The latter consideration and the influence of global commodity prices on the domestic prices have become more important with the opening and growing integration of the economy with the rest of the world