Kerala slips to third as inflation eases in state; Telangana retain first spot

Inflation in Kerala slightly eased in February, with the rate slipping to 3.50 per cent, according to the latest data released by the Union Ministry of Statistics and Programme Implementation.

The state, which consistently recorded the highest inflation in the country for daily essentials throughout 2025, has now moved down in the rankings. Rural inflation in the state stood at 3.97 per cent, while the urban rate was 3.11 per cent.

Telangana recorded the highest inflation in the country for the second consecutive month, registering 5.02 per cent in February, according to government data released on Thursday. Telangana is followed by Rajasthan, which reported an inflation rate of 3.53 per cent, with Kerala placed third. The lowest inflation was recorded in Mizoram at 0.1 per cent.

From January to December 2025, Kerala had consistently recorded the highest inflation in the country. In December, the state's inflation rate had surged to 9.49 per cent. 

However, in January 2026, Kerala stood in the second position with an inflation rate of 3.67 per cent. This was after the Centre revised the base year for calculating retail inflation from 2012 to 2024. The revision also updated the Consumer Price Index (CPI) basket to better reflect current consumption patterns.

Under the new CPI series, the number of weighted items for Kerala stands at 335 in rural areas and 342 in urban areas, with a combined total of 345 weighted items for the state.

Contrary to the trend in Kerala, the national CPI-based retail inflation rose to 3.21 per cent in February, compared with 2.74 per cent in January, mainly driven by higher food prices.

However, retail inflation remained within the Reserve Bank of India's target band. The government has mandated the central bank to maintain inflation at 4 per cent, with a tolerance band of 2 percentage points on either side.

Food inflation in February rose sequentially to 3.47 per cent from 2.13 per cent in January. Major items witnessing sharp price increases included silver, gold, diamond and platinum jewellery, coconut-copra, tomato, and cauliflower. On the other hand, garlic, onion, potato, arhar, and litchi saw disinflation.

Food inflation was the highest in Kerala at 6.17 per cent. Meanwhile, in Telangana, it was 3.30 per cent, and in Rajasthan, it was 2.87 per cent. 

At the national level, inflation in rural and urban areas stood at 3.37 per cent and 3.02 per cent, respectively.