With reference to India's retail inflation and the RBI's mandate, consider the following statements: 1. The RBI's upper tolerance limit for inflation is 6%. 2. Retail inflation in October reached 6.09%, breaching the upper limit for the first time in two years. 3. Food inflation in October was recorded at 5.54%. Which of the statements given above is/are correct?

India retail inflation hits 6.09 per cent, breaching RBI upper limit for first time

GS3Economy · S&T · Environment · Security· Growth, inflation & macro indicators· Prelims + Mains· 13 November 2026

Monetary policy and inflation dynamics: a key GS3 topic regarding CPI and RBI tolerance bands.

Why in news

Retail inflation in India reached 6.09% in October, breaching the Reserve Bank of India's upper tolerance limit of 6% for the first time in two years.

Background

Retail inflation rose from 5.54% in September to 6.09% in October. Food inflation accelerated to 8.94%, with onion prices more than doubling and garlic inflation crossing 60%.

Facts for Prelims

FactRBI inflation target: 4% with a tolerance band of 2% to 6%.
FactRetail inflation in October: 6.09%.
FactFood inflation in October: 8.94%.
FactCPI sub-groups with inflation >= 4%: 19 in October (up from 14 in September).
BodyMoSPI: Ministry responsible for releasing the consumer price index data.

Prelims practice question

With reference to India's retail inflation and the RBI's mandate, consider the following statements:

The RBI's upper tolerance limit for inflation is 6%.
Retail inflation in October reached 6.09%, breaching the upper limit for the first time in two years.
Food inflation in October was recorded at 5.54%.

Which of the statements given above is/are correct?

(a)1 only
(b)2 only
(c)3 only
(d)1 and 2 only

Show answer

Answer: (d) 1 and 2 only — Statements 1 and 2 are correct. Statement 3 is incorrect: Food inflation in October was 8.94%.

For Mains

Q. Analyze the factors contributing to the broadening breadth of retail inflation in India and its implications for monetary policy.

Dimensions to cover in your answer

Monetary policy friction: RBI's mandate to control inflation vs. supply-side shocks in food prices
Breadth of inflation: Shift from localized food price spikes to systemic price pressure across 19 CPI sub-groups

Keywords: Retail Inflation · Consumer Price Index · Monetary Policy · Tolerance Band · Supply-side Shocks

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