India’s inflation rate accelerated to 3.9% in May 2026 from 3.5% in April, marking its highest level since January of the previous year. Nonetheless, it came in slightly below market expectations of 4% and remained under the Reserve Bank of India’s medium-term target of 4%.
Food inflation—an especially significant component of the Indian consumer basket—climbed to 4.8% from 4.2% in April, reaching a 16‑month high. This uptick was driven in part by the conflict in the Middle East, which pushed up energy and fertilizer costs, both critical inputs for food production in India.
Price increases were also pronounced in categories such as personal care, social protection, and miscellaneous goods and services (18.5%), as well as restaurants and accommodation (5.75%). By contrast, inflation remained subdued in transportation (1.75%) and housing and utilities (1.73%). On a monthly basis, consumer prices rose by 0.8%.
