Wholesale Price Index (CPI)
- It measures average change in commodity prices in the wholesale market.
- The three commodity groups are: Primary Products, Fuel and Power, and Manufactured Products.
- Weights assigned to each commodity are on the basis of production value net of net imports.
- Compiled and published monthly by the Office of Economic Advisor, Ministry of Commerce and Industry.
- Base year for WPI: 2011-12.
Consumer Price Index (CPI)
- Average change in prices paid by the ultimate consumers for a basket of goods and services over time.
- The types of CPIs are due to the diversity in the condition of society.
- Industrial Workers Price Index (CPI-IW): Measures commodity basket of industrial workers
- Consumer Price Index for Urban Non-Manual Employees (CPI-UNME): It measures the change in commodity baskets consumed by nonmanual employees.
- CPI for Rural Laborers and Agricultural Laborers (CPI-AL&RL): Measures change in commodity baskets consumed by rural laborers.
New CPIs
- Covers all segments of the population of India.
- Compilated and published by the Central Statistical Organisation (CSO) for All India Level and the State/UT Level.
- New Indices: CPI (Rural), CPI (Urban), and CPI (Combined).
- Reserve Bank of India (RBI) uses CPI (Combined) as the sole inflation measure for monetary policy.
Comparative Analysis of Wholesale Price Index (WPI) and Consumer Price Index (CPI)
- WPI and CPI are on the same base year, 2011-12, but with different commodity numbers and weights.
- Inflation based on WPI is generally low, while inflation based on CPI is generally high.
- WPI is not very suitable for monetary policy decisions, while CPI is very suitable.
Producer Price Index (PPI)
- PPI measures the average change in selling prices received by domestic producers over time.
- It measures price changes from the perspective of producers.
