Consumer Food Price Index (CFPI)

The Consumer Price Index (CPI) for May 2024 is based on 2012, and it tracks price changes in food items across rural, urban, and combined regions.

About the Consumer Food Price Index:

1. Definition: The Consumer Food Price Index (CFPI) measures the fluctuation in retail prices of food items consumed by the population.
2. Focus on Inflation: It is a specific measure of inflation that solely concentrates on the price changes of food items in a consumer's basket of goods and services.
3. Relation to the CPI: The CFPI is a subset of the broader Consumer Price Index (CPI) and is utilized by the Reserve Bank of India (RBI) to monitor inflation.
4. Initiation of Publication: Since May 2014, the Central Statistics Office (CSO) under the Ministry of Statistics and Programme Implementation (MOSPI) has been separately publishing the CFPI for rural, urban, and combined categories on an all-India basis.
5. Methodology: Similar to the CPI, the CFPI is calculated monthly, adhering to the same methodology. The base year is presently 2012, which was revised from 2010 in January 2015.

What is Deflation:

1. Deflation occurs when prices decrease over time, in contrast to inflation, which refers to rising prices.
2. Various factors can drive deflation, such as increased productivity, abundance of goods and services, decreased overall demand, or a reduction in the supply of money and credit.

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