Summary of this article
August CPI-IW rose to 154.4 from 153.2 in July.
January 2027 DA calculation currently stands at 65.05 per cent.
Four more CPI-IW readings will determine the final rate.
Central government employees are closely watching the next dearness allowance (DA) revision, which is due from January 2027. The latest inflation data has pushed the running DA calculation above 65 per cent, raising the possibility of a higher rate next year.
The All-India Consumer Price Index (CPI) for Industrial Workers (CPI-IW) rose to 154.40 in August 2026 from 153.20 in July, according to the Labour Bureau. The index is used in the DA calculation for central government employees. The current calculation points to 65.05 per cent. However, this is not the final January 2027 DA rate. Four more monthly CPI-IW readings, from September to December, will be part of the calculation.
Why Is DA Linked To CPI-IW
DA is revised twice a year for central government employees. The calculation is linked to changes in the CPI-IW, which tracks changes in retail prices for a basket of goods and services consumed by industrial workers.
For the January 2027 revision, the calculation is using CPI-IW data for the six months from July-December 2026. August is the latest available reading; so four months of data are still pending. The current 65.05 per cent figure comes from the average CPI-IW for the relevant 12-month period up to August. As new readings arrive, that average will change.
What Could 67 Per Cent DA Mean For Salary
The impact depends on an employee’s basic pay because DA is calculated as a percentage of basic pay. For instance, on a basic pay of Rs 18,000, DA at 63 per cent would be Rs 11,340. At 67 per cent, it would be Rs 12,060. The difference would be Rs 720 a month.
On a basic pay of Rs 44,900, DA at 63 per cent would be Rs 28,287. At 67 per cent, it would rise to Rs 30,083, giving a difference of Rs 1,796 a month. These numbers cover only the DA component. The actual change in monthly take-home pay can differ because of other salary components and deductions.
When Will The January DA Rate Be Clear
The September, October, November and December CPI-IW readings will be released according to the Labour Bureau’s schedule, with the December 2026 index due on January 29, 2027.
Once the six-month data for the January revision is available, the final DA calculation can be worked out. The government will then formally notify the revised rate.
Therefore, the possible 67 per cent figure should be viewed as an estimate at this stage, rather than a confirmed January 2027 rate.
