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Telangana Tops State Inflation at 4.9% as Most States Stay Below 3% in Jan 2026

Most Indian states recorded Consumer Price Index inflation below 3% in January 2026, indicating broadly stable regional price pressures. Telangana was a significant outlier, posting the highest state-level inflation at 4.9%, well above the national average. The state's inflation increased sharply under the new CPI series, attributed to its structural shift towards a service-oriented economy post-bifurcation. The report also found core inflation, excluding food and fuel, was higher than headline inflation in most states but below the all-India core level.

Key Points: State CPI Inflation: Telangana Highest, Most Below 3% in Jan 2026

  • Most states below 3% inflation
  • Telangana highest at 4.9%
  • New CPI series shifts state trends
  • Structural economic changes drive Telangana's inflation
2 min read

Most states record CPI inflation below 3% in January 2026; Telangana highest at 4.9%: SBI Research

SBI Research reports most Indian states had CPI inflation under 3% in January 2026, but Telangana recorded the highest at 4.9%. Analysis reveals state-level trends.

"Telangana stood out with the highest inflation reading among states at 4.9 per cent - SBI Research"

New Delhi, March 6

India's Consumer Price Index inflation remained subdued across most states in January 2026, under the new CPI series, with the majority reporting inflation below the 3 per cent mark, according to a report by SBI Research.

The report noted that only a few states recorded higher inflation levels, with Telangana posting the highest CPI inflation at 4.9 per cent, significantly above the national average.

The state-wise analysis shows that inflation trends remain moderate across India. Most major states registered CPI inflation below 3 per cent in January 2026, indicating stable price pressures at the regional level.

However, Telangana stood out with the highest inflation reading among states at 4.9 per cent, suggesting stronger price pressures compared with the national average.

The report also compared the new CPI series with earlier inflation data and found noticeable shifts in state-level inflation trends.

Kerala recorded a decline in CPI inflation from 8.05 per cent earlier to 6.37 per cent under the new series, indicating moderation in price pressures.

In contrast, Telangana and Bihar witnessed increases in inflation. Telangana's inflation rose from 0.20 per cent earlier to about 4.91 per cent, while Bihar's increased from 0.01 per cent to about 2.49 per cent under the revised data series.

A division-wise comparison of CPI inflation shows Telangana experiencing higher inflation than the all-India average across 11 out of 12 CPI divisions.

These divisions include categories such as food and beverages, housing and utilities, health, transport, education, and services. The report said this broad-based price rise highlights structural differences in the state's consumption basket compared with the national average.

The report attributes part of Telangana's inflation dynamics to structural economic changes following the bifurcation of the erstwhile united Andhra Pradesh.

Since the split, Telangana has become a predominantly service-oriented economy, with the tertiary sector accounting for about 67 per cent of its Gross Value Added, compared with around 42 per cent in Andhra Pradesh.

This shift towards services is believed to influence the composition of the CPI basket and inflation patterns in the state.

The report also analysed core CPI (excluding food and fuel) across states. It found that in most states, core inflation was higher than headline inflation, although it remained lower than the all-India core CPI level of 3.38 per cent.

- ANI

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Reader Comments

R
Rohit P
Interesting to see the impact of the state bifurcation. Telangana becoming a service economy (67% GVA!) explains the different inflation basket. Prices for services like healthcare, transport, and education are always sticky and rise faster. This data is more insightful than just headline numbers.
S
Sarah B
As someone who recently moved to Hyderabad for work, I can feel this pinch. Rent, cab fares, even a cup of tea seems more expensive here compared to my hometown in Maharashtra. The report makes sense now. The growth is good but cost of living is catching up fast. 🏙️
A
Aman W
While the overall picture is stable, we must be cautious. Core inflation is still above headline in most states. That means prices of essential non-food items are not coming down easily. The common man's wallet is still under pressure, even if the vegetable prices are low this season.
K
Karthik V
Kerala's inflation coming down from over 8% to 6.37% is a big relief! Was struggling with prices of everything from fish to electricity last year. Hope this trend continues. Good to see data that reflects ground reality.
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Michael C
The report mentions a "new CPI series". This is important. Sometimes inflation looks lower or higher just because the way it's measured has changed. We need more transparency on what weights have changed in this new basket, especially for states like Telangana and Bihar showing big jumps.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

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