The government will publish a new inflation series today to reflect the changing spending patterns and give a better view of underlying price pressures. On 27 February, it will release a new set of GDP figures, which analysts say may show a sharp revision higher in the size of the economy.

“Over the past 10 years, there’s been more than a doubling of expenditure per household and that reflects an increase in the socio-economic status of people in general,” Saurabh Garg, secretary in the Ministry of Statistics and Programme Implementation, said in an interview in New Delhi.

The inflation data will be based on a new consumer price index, which cuts the weight of volatile items such as food to about 36.8% from nearly half and shifts the base year to 2024 from 2012. Prices have also been collected nationwide and new categories, such as rentals for rural housing and online marketplaces, have been added.

The overhaul comes amid scrutiny of the Reserve Bank of India’s inflation forecasting model after it consistently overestimated price pressures, potentially contributing to a hawkish policy stance. The exercise is being closely watched by markets as it could alter expectations for interest rates at a time when foreign flows are highly sensitive to policy signals.

The ministry will release the inflation data at 4:00 pm local time on Thursday. It will include figures for 2025 based on the index weights, making comparisons easier.

Garg said India’s consumption basket has shifted significantly, with households spending less on cereals such as rice and wheat and higher on fruits, vegetables, dairy and meat, reflecting improving socio-economic conditions.

“You spend more on fresh fruits and vegetables when you have a slightly larger disposable incomes,” the secretary said.

The South Asian nation’s economy is projected to rise 7.4% in the financial year through March and over 7% in the next financial year. Prime Minister Narendra Modi’s government has repeatedly said the country has already become the world’s fourth largest economy, overtaking Japan.

Apart from capturing shifts in food consumption, the upgraded CPI will track spending in areas such as online shopping, dining out and streaming services including Amazon and Netflix.

The revision follows a long gap—the last update was in 2015—though global norms call for CPI weights and baskets to be revised every five years, based on household consumption surveys. The survey exercise was delayed due to several reasons, including the Covid-19 pandemic.

The government is also upgrading the base year for GDP to 2022-23 from 2011-12 to reflect new economic structures. Garg said that the availability of new data sources such as goods and services tax, new electric vehicle registrations and information on informal sector and horticulture will be incorporated.

Garg said the government is finalising a new producer price index as well to offer a more precise understanding of price pressures in the economy across the supply chain. “When we have the provisional estimates in May, we hope that we should be able to use producers’ price index as deflator for GDP,” he said.