The trends in inflation Source: Author’s own calculations using CPI-C data derived from the Ministry of Statistics and Programme Implementation. Available at www.mospi.gov.in/. Figure 1 depicts the behaviour of the mean and standard deviation of the headline, core and food inflation rates for January 2012 to June 2019. It can be clearly seen that while the mean values of each of the inflation measures for the period is approximately percent headline inflation, 5.96 core inflation and 6.03 food inflation, the standard deviation varies across the three measures. It can be used to measure the long-term volatility in a particular time series such that the higher the standard deviation the higher the long-term volatility. It is interesting to note that while food inflation is normally considered to be the most volatile component, its volatility as measured by the standard deviation is the least at 1.7675, followed by headline inflation, at 2.69, in the
