Difference Between Wholesale Price Index (WPI) and Consumer Price Index (CPI)

The Wholesale Price Index (WPI) and the Consumer Price Index (CPI) are two popular measures used to gauge inflation in a country. They both track changes in prices, but they do so at different stages and focus on different types of goods and services.

Wholesale Price Index (WPI):

• What It Measures: WPI shows the average change in prices of goods sold in bulk at the wholesale market. It reflects price changes at the beginning of the supply chain before goods reach retail stores.
• Purpose: To track price changes in goods that are bought and sold in bulk within the trade market.
• Calculation: The Office of Economic Advisor releases this index, focusing on the prices of goods sold by wholesalers.
• Stage: It measures the initial stage of transactions, primarily looking at wholesale prices.
• Area: WPI focuses solely on goods, excluding services.
• Year Used: Uses the financial year as a guide for calculations.

Consumer Price Index (CPI):

• What It Measures: CPI examines the average change in prices paid by consumers for a basket of goods and services. It reflects the cost of living and how much consumers have to spend on everyday items.
• Purpose: To monitor changes in the cost of living and assess inflation as experienced by consumers.
• Calculation: Released by the Central Statistics Office, CPI includes both goods and services purchased by consumers.
• Stage: It measures the final stage of transactions, focusing on retail prices.
• Area: CPI includes both goods and services.
• Year Used: Uses the calendar year as a guide for calculations.

Difference Between is as Follow:

The article highlights the distinctions between the Wholesale Price Index (WPI) and the Consumer Price Index (CPI), explaining their unique roles in measuring inflation. For more insightful content and updates, continue to follow Eduacademy.