State of the Economy-July 2026 Bulletin - Notes on Reserve Bank of India

In each edition, there is an article titled "State of the Economy". This note discusses the [article](https://rbi.org.in/scripts/BS_ViewBulletin.aspx?Id=24305) in July 2026 edition, and key charts and points to understand each metric and their meaning. [Link to article (in pdf)](RBI_Monthly_Bulletin_Article_202607_State%20of%20the%20Economy.pdf) ### Introduction 1. The weighted average call rate (WACR) hovered in the upper half of the policy corridor = Upper half = MSF $-$ Repo Rate. 2. Chart II.1b: EMEs vs AEs - financial market volatility in ticked up in early July due to capital outflows amidst higher US yields, geopolitical tensions and pick-up in crude prices. In contrast, volatility remained largely contained in advanced economies (AEs), supported by robust earnings, easing inflation concerns and safe-haven capital inflows. 3. Chart II.2 - In Early 2026, around 80-100 oil tankers passed through the Hormuz daily carrying around 16-20 million barrels of crude oil daily. 4. Chart II.4: Brent Crude Price: Spot and Futures - It is a backwardation curve. Whenever futures curves slope downward like this (futures prices lower than spot, the market is in backwardation. It signals that while near-term supply shocks pushed immediate prices up, the market expected prices to normalize downwards over the long horizon. ![RBI_Monthly_Bulletin_Article_202607_State of the Economy_Chart II.4 Brent Crude Price - Spot and Futures copy|350](RBI_Monthly_Bulletin_Article_202607_State%20of%20the%20Economy_Chart%20II.4%20Brent%20Crude%20Price%20-%20Spot%20and%20Futures%20copy.png) ### Aggregate Demand 1. Major high Frequency Indicators for [Employment](Periodic%20Labour%20Force%20Survey%20(PLFS).md) are: 1. Unemployment rate (PLFS: All-India) 2. Unemployment rate (PLFS: Rural) 3. Unemployment rate (PLFS:Urban) 4. Naukri JobSpeak Index 5. PMI Employment: Manufacturing 6. PMI Employment: Services 2. [Fiscal Deficit ](G-Secs-Primary%20Market.md#Metrics%20used%20in%20analyzing%20the%20debt)(FD) or Gross Fiscal Deficit = (Revenue + Capital Expenditure) - (Revenue Receipts \[Tax + Non-Tax\] + Non-Debt Capital Receipts). Fiscal Deficit excludes borrowings (debt capital receipts). 3. Government revenue data is compiled and released by the ==Controller General of Accounts (CGA)==, which operates under the Department of Expenditure, Ministry of Finance. ### Trade (Page 22) 1. India’s merchandise trade deficit, difference in value of goods imported and exported, was at US$ 86.9 billion during Q1:2026-27, higher than US$ 68.7 billion a year ago, and US$ 82.5 billion during Q4:2025-26, primarily driven by ==faster rise in the imports of electronic goods, petroleum products and gold.== 2. There has been a very high growth (triple-digit) in imports from countries such as Oman, Brazil, and Nigeria, reflecting India’s recent ==initiatives to diversify the source== of petroleum, crude and products imports. 3. As part of India’s trade diversification efforts, the India-UK Comprehensive Economic and Trade Agreement [CETA](CETA%20(India-UK)%20July%202026.md) came into effect from [July 15, 2026](https://www.pib.gov.in/PressReleasePage.aspx?PRID=2284878&reg=3&lang=1). 4. 28 Services exports grew by 2.8 per cent (y-o-y) in May 2026 as compared with 9.4 per cent in May 2025, mainly driven by business and transport services, whereas services imports grew at a faster rate of 5.6 per cent (y-o-y) in May 2026 as compared with a contraction of 1.1 per cent in May 2025, through a rise in software, transport, and business services. ### Aggregate Supply (Page 24) 1. The cumulative southwest monsoon rainfall (up to July 20) has been below normal with skewed (uneven) temporal (time) and spatial (location) distribution 2. Kharif season - As of July 17, farmers have sown crops on land equal to 59.6% (acreage) of the area that's typically sown by the *end* of the entire kharif season (full season normal area). 3. As compared to previous year, the gap in sowing area declined to 6.0 per cent from 16.0 per cent in the previous week (July 10, 2026). Here's an example: if last year, by July 17, area sown was, say 100 units, and this year by July 17 it's 94 units, the gap = (100-94)/100 = 6% below last year's level on the same date. 4. The India Meteorological Department (IMD) has forecast below-normal rainfall for July. Here "Below Normal" means the IMD expects rainfall to fall between 90% and 95% of the historical average. 5. Govt procured 562 lakh tonnes by July 20, 2026 , which is 5.5% higher than *the same point* in the previous season (KMS 2024-25). Rice procurement also running ahead of last year, but the paragraph doesn't mention a specific target for rice like it did for wheat. 6. One lakh = 100,000, and 1 million = 10 lakh = 10,00,000. So 357.6 lakh tonnes = 35.76 million tonnes, and 562 lakh tonnes = 56.2 million tonnes, and 1 tonne is 1000 kgs. 7. Chart III.6 mentions names of 3 agencies for data: 1. MoAFW = Ministry of Agriculture and Farmers Welfare, which is the primary source for food grain production data, crop sowing/acreage figures, and agricultural statistics generally. 2. MoSPI = Ministry of Statistics and Programme Implementation - India's central statistical agency, source for macro data like GDP, Index of Industrial Production-IIP, CPI/inflation, and other official statistics. 3. CMIE (Centre for Monitoring Indian Economy) = a private data and analytics firm (and is not a government firm). It publishes widely used for economic data like employment/unemployment rates, corporate finance data, etc. 8. **Crop Seasons in India:** | Stage | Kharif | Rabi | | ----------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | Sowing period | June to July, right when the first monsoon rains start. | October to December, as the monsoon retreats and temperatures cool down. | | Growing phase | July to September, under warm and humid weather. | December to March, requiring cool weather during growth and warm conditions for ripening. | | Harvesting period | September to October (stretching into November in some areas). | March to May (spring/early summer). | | Water dependency | Mainly rain-fed, needing a lot of water from the southwest monsoon | Mainly irrigation-fed (canals, tube wells) and retreating/northeast monsoon rains, requiring light, timely watering. | | Crops | Cereals and millets: Rice (paddy), maize, jowar (sorghum), bajra (pearl millet), and ragi. Pulses: Arhar (tur/pigeon pea), moong dal, and urad dal. Oilseeds: Soybean, groundnut, castor, and sesame. Cash crops: Cotton, sugarcane, and jute | Cereals: Wheat, Barley, OatsPulses: Gram (Chickpea), Lentil (Masoor), Peas Oilseeds: Mustard (Rapeseed), Linseed, Safflower Spices and Vegetables: Coriander, Cumin, Fenugreek, Potato, Onion, Garlic | 10. The Ministry of Statistics and Programme Implementation (MoSPI) released the [Index of Services Production (ISP)](Index%20of%20Services%20Production%20(ISP).md)[base year: 2024–25] on July 14, 2026 on trial basis. ### Inflation (Page 28) 1. A note on [Inflation](Inflation.md) **Chart III.8.b - How is it calculated?** ![[RBI_Monthly_Bulletin_Article_202607_State of the Economy_Chart III.8-Rise in Headline Inflation in June.png|450]] Taking the numbers from Chart III.8 for June 2026, we get contribution from categories as: 1. Food & Beverages = $\frac{36.8}{100} \times 5.1\% = 1.88 \text{ percentage points}$ 2. Fuel $= \frac{10.2}{100} \times 4.5\% = 0.46 \text{ percentage points}$ 3. Core (Excl. Food & Fuel) $= \frac{53.0}{100} \times 3.9\% = 2.07 \text{ percentage points}$ 4. Sum of Contributions $= 1.88 + 0.46 + 2.07 = 4.41\% \approx 4.4\% \text{ (Headline Inflation)}$ Derivation to find contribution to the overall CPI Inflation: ^11a94a Step 1 - We define the headline CPI Index ^11a94a By definition, the overall Headline CPI index at any time $t$ is the sum of its component indices weighted by their expenditure shares ($\text{w}_\text{i}$, where $\sum \text{w}_\text{i} = 1$ , and $I_1,t$ is index value of item(1) in period t): $I_t = w_1 I_{1,t} + w_2 I_{2,t} + w_3 I_{3,t}$ Step 2 - We write the headline inflation formula Year-on-year headline inflation is the percentage change in the Headline Index from last year ($t-12$) to this year ($t$): $\text{Headline Inflation} = \dfrac{I_t - I_{t-12}}{I_{t-12}}$ Step 3 - We substitute the weighted indices into the inflation formula Replace $I_t$ and $I_{t-12}$ with their weighted components: $\text{Headline Inflation} = \dfrac{(w_1 I_{1,t} + w_2 I_{2,t} + w_3 I_{3,t}) - (w_1 I_{1,t-12} + w_2 I_{2,t-12} + w_3 I_{3,t-12})}{I_{t-12}}$ Group the terms by component ($w_1, w_2, w_3$): $\text{Headline Inflation} = \dfrac{w_1 (I_{1,t} - I_{1,t-12}) + w_2 (I_{2,t} - I_{2,t-12}) + w_3 (I_{3,t} - I_{3,t-12})}{I_{t-12}}$ Split this into three separate fractions: $\text{Headline Inflation} = w_1 \left( \dfrac{I_{1,t} - I_{1,t-12}}{I_{t-12}} \right) + w_2 \left( \dfrac{I_{2,t} - I_{2,t-12}}{I_{t-12}} \right) + w_3 \left( \dfrac{I_{3,t} - I_{3,t-12}}{I_{t-12}} \right)$ Step 4 - The Assumption In index math, because component indices in the base period and the headline index level belong to same year, we can assume $I_{1,t-12} \approx I_{t-12}$ $\dfrac{I_{1,t} - I_{1,t-12}}{I_{t-12}} \approx \dfrac{I_{1,t} - I_{1,t-12}}{I_{1,t-12}} = \text{Inflation}_1$ Substituting this back gives the final formula: $\text{Headline Inflation} \approx (w_1 \times \text{Inflation}_1) + (w_2 \times \text{Inflation}_2) + (w_3 \times \text{Inflation}_3)$ **Indian Basket Crude Oil Prices** 1. The Indian basket crude oil eased to US$ 75.6 per barrel in July (up to 20 July) - The basket is made up of Sweet grade (Brent dated) and Sour grade (Oman and Dubai average) imported by Indian refineries during the month in the ratio 61:39 for April, 70:30 for May, 71:29 for June and 79:21 for July. ### Financial Conditions (Page 31) 1. *"Overall, daily average net absorption under the LAF increased to ₹1.25 lakh crore during July (up to July 20) from ₹0.89 lakh crore in June."* 1. It is the average daily outstanding balances under the LAF = Sum of the (daily outstanding balances under LAF - Excess Reserves) for all days in July and divides it by the number of days in July. 2. ==If it is positive, system liquidity remained in deficit, as reflected in net injections by RBI, averaged daily at the figure provided. If it is negative, system liquidity surplus, as reflected in net absorptions by RBI, averaged daily at the figure provided. But in the graph, absorption is shown along positive axis.== 3. A detailed note on [Banking System Liquidity (Autonomous Drivers & Instruments)](Money%20Market%20Operations%20(MMO).md#Banking%20System%20Liquidity%20(Autonomous%20Drivers%20&%20Instruments)) 2. Chart IV.1 is a very important graph. 3. Chart IV.1:Total absorption = Outstanding balance under VRRR + Outstanding balance under SDF 4. Chart IV.1:Total Injection = Outstanding balance under VRR + Outstanding balance under MSF 5. Chart IV.1: Total absorption - Total Injection = Net liquidity adjustment facility 6. In the graph, we can see system liquidity surplus falling in June. To address this transient liquidity shortage during June-July, RBI conducting VRR at the same time. During June, the RBI conducted 13 VRR auctions with maturities ranging from overnight to 7 days with average bid-cover ratio of 0.54. Further, during July (up to July 20) RBI conducted 10 VRR auctions with average bid-cover ratio of 0.48. 7. A bid-cover ratio of 0.48 in VRR means for every Re 1 notified for lending by RBI under the LAF, RBI received (accepted+rejected if any) bids worth 48 paise, which shows weak demand. Bid ratio falling from 0.54 to 0.48 shows increasing system liquidity surplus and hence banks were choosing not to borrow the offered money. 8. A [note](Producer%20Price%20Index%20(PPI).md) on producer price index (OPPI, IPPI and SPPI) 9. Chart III.13 uses PMI data - A note on the [PMI](PMI.md) (Indices) here. 10. Chart IV.2 - It compares the secured overnight rupee rate ([SORR](MIBOR.md#SORR)) with unsecured overnight rate [Trading](Call,%20Notice%20and%20Term%20Money.md#Trading) 11. The prevailing rates on the small savings instruments exceed their formula-based rates, except for the Public Provident Fund (PPF). 12. Money and Credit - The reserve money (adjusted for cash reserve ratio) continued to grow in June 2026, with currency in circulation sustaining a double-digit growth since December 2025. 1. $\text{Adjusted } \text{M}_{0 (2026)} = \text{M}_{0 (2026)} - (\text{CRR Balances}_{2026} - \text{CRR Balances}_{2025})$ 13. The money supply growth also edged up in June 2026 (Chart IV.4).58 14. In Yield Curve(Zero-coupon yield curve/spot rate curve), we take market prices of the bond, the coupon rates for that tenor, and find the zero-coupon spot rates ($z$) (zero-coupon yields) for corresponding tenor, and plot them on y axis. In other words, inputs are market prices + coupon rates, output is the bootstrapped zero rate $z_t$ per tenor, plotted on the y-axis. 15. In a Par Yield Curve, we take zero rates, set the price of bond equal to par, say 100, and find coupon rates for each tenors and then plot these coupon rates ($C$) on y axis. It is the coupon rate that makes that maturity's hypothetical price equal to par/100. In other words, inputs are the zero curve (known zero rates from above step 14) + price fixed at 100, output is the solved coupon rate $C_t$ per tenor (= the par yield), plotted on the y-axis. 16. Table IV.1: Average Corporate Bonds Yields Softened in July. 1. Spread = Average corporate bond yield (June) − Average G-sec yield (June), where Average yield of G-sec (June) = simple average of these daily readings: $\displaystyle \text{Avg G-sec yield}_{\text{June}} = \dfrac{\sum_{\text{d}=1}^{n} y_d}{n}$ where $\text{y}_\text{d}$ = daily G-sec yield, and $n$ = number of trading days in June. 17. Incremental C-D ratio compares the change (increment) in credit and deposits over a period. It is not the total outstanding stock like the regular C-D ratio. 1. $\text{Regular Credit-Deposit ratio (stock, point in time)} = \dfrac{\text{Total outstanding credit}}{\text{Total outstanding deposits}}$ 2. Incremental Credit-Deposit ratio (flow, over a period) =$\dfrac{\text{Credit}_{t} - \text{Credit}_{t-1}}{\text{Deposits}_{t} - \text{Deposits}_{t-1}}$, that is, new credit disbursed during the period ÷ new deposits mobilized during the same period. 18. Chart IV.5: SCBs’ Credit and Deposit Growth Rose Further - Important chart 19. In RBI terminology, **Food Credit** refers specifically to bank loans given to state agencies like the **Food Corporation of India (FCI)** and state procurement agencies to finance the purchase and procurement of foodgrains (wheat and rice) directly from farmers under Minimum Support Price (MSP) operations. Now food procurement is driven purely by government policy and seasonal harvest cycles, these loans fluctuate a lot and don't reflect normal economic activity or private sector borrowing. 20. So "Non-Food Credit" is simply all other bank credit given to every single private and public sector borrower in the economy 21. **Sector-wise and Industry-wise Bank Credit (SIBC) return**. It is a [return](Returns%20Submitted%20to%20RBI.md) submitted monthly and covers 41 select banks, accounting for about 95% of total non-food credit extended by all scheduled commercial banks. This is used for the detailed breakdown, that is, how much credit went to which sector (agriculture, industry, services, personal loans) and which industry within that. It is large enough (not all) to represent ~95% of total credit. 1. Search keyword on RBI's website is *Sectoral Deployment of Bank Credit*. 22. Section-42 return - It is a separate, fortnightly return covering all SCBs (not just 41 banks). Section 42 of the RBI Act is related to CRR/reserve reporting requirements, which banks file fortnightly, and it's used to compute the total non-food credit growth rate , since it's more complete and more frequent than SIBC. 23. Related Note - [List of returns submitted to RBI](Returns%20Submitted%20to%20RBI.md) 24. Chart IV.8: [Transmission](Monetary%20Policy%20Transmission%20OPEN.md) across Select Sectors. 1. Transmission during February 2025 to May 2026 is calculated by subtracting the weighted average lending rates of January 2025 from those of May 2026. 25. A [note](Interest%20Rates%20on%20Loans%20&%20Advances.md) on lending rates regimes - MCLR, EBLR, etc. 26. Chart IV.11a - [Inward FDI or simply FDI](Foreign%20Investment%20in%20India%20(Various%20Routes).md#3.%20FDI%20(Equity,%20in%20Rupee)%20-%20Foreign%20Direct%20Investment) remained higher in both *gross and net terms*, supported by lower repatriation. 1. Net Inward FDI = Gross Inward FDI $-$ repatriation/divestment. 2. Net [Outward FDI](External%20-%20Overseas%20Investments.md) = Gross FDI Outflows by Indian companies abroad $−$ Repatriation/Divestment back to India 3. Net FDI = Net Inward FDI $-$ Net Outward FDI 4. Net FDI = Red $-$ Grey $-$ Green *(Chart IV.11)* 5. ==Higher the Net FDI, higher the external liabilities on [IIP](IIP%20OPEN.md), reducing Net IIP.== India's International Investment Position (Quarterly Report) ([IIP](https://rbi.org.in/scripts/Pr_DataRelease.aspx?SectionID=356&DateFilter=Year&Part=Annual)) is released with a lag of 3 months. 27. A country-wise, sector wise break up of FDI equity flows is also given. We can also see top recipient countries of our outward FDI. 28. Chart IV.12: FPI Inflows (Debt+Equity) data is sourced from NSDL. If there is outflow, we must see if it is from equity or debt, and not just conclude that outflows are from debt segment. 29. Here the aim is to not analyse all the components of [capital account](Capital%20Flows%20-%20Account%20&%20Management.md#^f47115) but the major ones to review shift in capital flows. 1. [FPI (Debt & Equity)](Foreign%20Investment%20in%20India%20(Various%20Routes).md#1.%20FPI%20(Debt%20&%20Equity)-%20Foreign%20Portfolio%20Investments) 2. [FDI ](Foreign%20Investment%20in%20India%20(Various%20Routes).md#3.%20FDI%20(Equity,%20in%20Rupee)%20-%20Foreign%20Direct%20Investment) 3. [ECB](ECB%20(Borrowings%20in%20INR%20and%20FCY).md) - This can be further broken down into Non-FDI ECB + FDI ECB 4. Banking Capital - Under this item, the report only mentions: Non Resident [Deposits](Deposits%20and%20Accounts.md) - NRI (specifically NRE(RA), FCNR(B), and NRO)+ NR. OFCBs by banks = ECB + other FCY borrowings. OFCBs are covered in [Master Direction – Risk Management and Inter-Bank Dealings dated July 05, 2016](https://www.rbi.org.in/Scripts/BS_ViewMasDirections.aspx?id=10485) 5. A related note - [External Debt-India OPEN](External%20Debt-India%20OPEN.md) 30. [June 5, 2026](https://rbi.org.in/Scripts/BS_PressReleaseDisplay.aspx?prid=62864) - RBI announced special swap facility for all 3 sources of capital flows - [Non Resident Deposits](Deposits%20and%20Accounts.md#By%20a%20Person/Entities%20resident%20outside%20India%20[Non-Resident%20]), Overseas foreign currency borrowings (OFCBs) and [ECB](ECB%20(Borrowings%20in%20INR%20and%20FCY).md) inflows. 31. Chart IV.14 - Some of the key external sector vulnerability indicators are: 1. short-term external debt (residual maturity, and original maturity) to total external debt 2. short-term debt (residual maturity, and original maturity) to reserves, 3. total external debt to reserves, 4. total external debt-to-GDP ratio, 5. short-term debt (residual maturity) to total debt, 6. concessional debt to total debt, 7. net international investment position (NIIP) to GDP ratio, Non-Debt Liabilities to Total External Liabilities Ratio, ratio of international assets to international liabilities 8. debt service ratio (Debt Service Payments to Current Receipts), 9. CAD to GDP ratio, 10. Reserve Covers - reserves to imports (import cover), reserves to imports+debt service, reserves to short-term debt (short-term debt cover), reserves to external debt (debt cover) or reserve cover of CAD and short-term debt. 11. Net Foreign Currency Assets (FCA) to Total Reserves 12. External Debt (US$ billion) 32. An [example of these indicators](https://rbi.org.in/scripts/BS_ViewBulletin.aspx?Id=14724) - [Table III.7](RBI_Monthly_Bulletin_Article_20140211_II.%20The%20External%20Sector.pdf): External sector vulnerability indicators showed a mixed trend. 33. Chart IV.16: India’s International Investment Position ([IIP OPEN](IIP%20OPEN.md)) = External Assets - External Liabilities. External Liabilities decrease due to actual decline in direct and portfolio investments (majorly), and due to depreciation in INR. $\displaystyle \text{External Liabilities in} = \dfrac{\text{External Liabilities in INR}}{\text{USDINR exchange rate}}$ 34. Chart IV.17 - Blue one shows appreciation so opening is higher edge and closing is lower edge. Highest point is worst closing for INR and lowest point is the best closing for INR for the week. For yellow bars, it is the opposite. #### REER - Chart IV.18 1. Chart IV.18.a - Here Change in [REER](REER.md) is the **month-on-month % change relative to the previous month's REER**, and not against the base year. Base year (2015-16=100) is just the index's origin point, so the bars show sequential MoM changes. 2. Chart IV.18 b - Decomposition change = nominal effect + relative price effect. Here let us try log change. 3. So we decompose change by growth rate of 2 REER and taking log of both sides. Example: We consider two REER readings with a single country so as: $\dfrac{85 \times 103}{91 \times 105}$ (prev) and $\dfrac{87 \times 105}{93 \times 108}$ (new) $\text{NEER}_\text{prev} = \dfrac{85}{91} = 0.9341$, $\text{NEER}_\text{new} = \dfrac{87}{93} = 0.9355$ $\text{Price}_\text{prev} = \dfrac{103}{105} = 0.9810$, $\text{Price}_\text{new} = \dfrac{105}{108} = 0.9722$ Nominal effect (log): $\ln\left(\dfrac{0.9355}{0.9341}\right) = \ln(1.00152) = 0.00152$ Price effect (log): $\ln\left(\dfrac{0.9722}{0.9810}\right) = \ln(0.99110) = -0.00894$ Sum = total REER change (log), check: $0.00152 + (-0.00894) = -0.00742$ $\ln\left(\dfrac{\text{REER}_{\text{new}}}{\text{REER}_\text{prev}}\right) = \ln\left(\dfrac{0.90950}{0.91627}\right) = \ln(0.99261) = -0.00743$ So here nominal effect = +0.152%, price effect = −0.894%, total REER change = −0.743% (depreciation), which is exactly RBI's chart (b) logic, that is, two log-terms adding exactly to the diamond point (total change). $\Delta \ln(\text{REER}) = \Delta \ln(\text{NEER}) + \Delta \ln(\text{Relative Price})$ Step 1 - Define growth rate $g$ as the actual % change (as decimal) $g = \dfrac{\text{X}_\text{new} - X_\text{old}}{X_\text{old}} = \dfrac{X_\text{new}}{X_\text{old}} - 1$ Step 2 - Rewrite this as: $\dfrac{X_\text{new}}{X_\text{old}} = 1 + g$ Step 3 - Now take the log difference which is exactly $\Delta \ln X$: $\Delta \ln X = \ln(X_\text{new}) - \ln(X_\text{old}) = \ln\left(\dfrac{X_\text{new}}{X_\text{old}}\right) = \ln(1+g)$ Step 4 - We apply your known approximation $\ln(1+x) \approx x$ for small $x$: $\Delta \ln X = \ln(1+g) \approx g$ So: $\Delta \ln X \approx g$ , that is, the log-difference is approximately equal to the actual % growth rate itself (as a decimal). Multiply by 100 to express as a percentage. Step 5 - Check with our dummy NEER numbers: $g = \dfrac{0.9355}{0.9341} - 1 = 0.001498 = 0.1498\%$ $\Delta \ln(X) = \ln\left(\dfrac{0.9355}{0.9341}\right) = 0.001497 = 0.1497\%$ Nearly identical (0.1498% vs 0.1497%) because $g$ is small here. So we computed $\Delta \ln X$, and it just happens to numerically equal (almost exactly) the real % change, which is why RBI's chart can label the log-based bars as "%" without it being misleading. ### WPI Base Year Revision 1. The base year for Wholesale Price Index has been revised to 2022-23 from 2011-12 by the Ministry of Commerce and Industry. On June 15, 2026, the new series with provisional data for the month of May 2026 alongside the back series from April 2023 to April 2026 was released. 2. A detailed note on [Inflation](Inflation.md) ## Related Notes 1. [Financial Stability Report-June 29, 2026](Financial%20Stability%20Report-June%2029,%202026.md)