Core Insights - The National Statistics Office (NSO) is set to release retail inflation estimates for January, marking the first report using 2024 as the base year, with differing estimates based on old versus new CPI methodologies [1] Inflation Estimates - Estimates using the old CPI weightings suggest a January inflation rate of 2.5-2.6 percent, while the new series estimates range from 2.45-3.2 percent, indicating a projected increase in retail inflation [2] Factors Influencing Inflation - The expected rise in headline inflation is attributed to the food basket exiting deflation, an increase in core CPI, and higher precious metal prices [3] - The new CPI series reduces the weighting of food & beverages from 45.86 percent to 36.75 percent, which may lessen food inflation's impact on the overall inflation figure [3] Changes in Weightings - The new weightings emphasize urban CPI and services, with a significant increase in the weighting for restaurants and accommodation services from 0.01 percent to 3.35 percent [4] - Transport and information & communications are also expected to see increased weightings by 2.43 and 1.38 percentage points, respectively, while food and beverages, education services, and clothing and footwear will see reductions [5] RBI Projections - The Reserve Bank of India's Monetary Policy Committee has slightly revised its inflation projection for 2025-26 to 2.1 percent, citing rising precious metal prices, and has increased its Q4FY26 inflation projection to 3.2 percent [6] Expert Opinions - Economists have varying expectations for January's inflation rate, with estimates around 2.6 percent based on the old base, but caution against making definitive assessments under the new series until more data is available [7] - Some economists predict the new CPI series could push January inflation closer to 2.9 percent due to the reduced weighting of food & beverages, while high gold and silver prices are expected to add significant upward pressure on inflation [8]