Wholesale Price Index WPI and Consumer Price index CPI are employed to assess the inflation level in an economy. Inflation is a situation that occurs when the cost of products and services constantly increases in time. Inflation is crucial to regulating how much money flows within the economy.
What’s the definition of wholesale Price Index WPI?
Wholesale price index is utilized to determine the average price change during wholesalers’ distribution of goods in bulk quantities. WPI also monitors price changes for commodities at the level you choose before getting to the endpoint, which is the consumer. WPI is the first stage where prices begin to increase in purchasing goods. It is released in the “Economic Advisor of the Ministry of Commerce and Industry”.
It’s only available for goods that are covered by WPI, which include power, fuel, as well as manufacturing items. It is released weekly for the essential things, fuel, and power. The base year of WPI is the financial year.
What’s the term Consumer Price index or CPI?
CPI is a consumer price index that evaluates the rate of change in the retail sale of goods or services in retail stores or the price of products or services directly sold to consumers.
CPI is the highest point at which prices increase for products or services. It is through the Central Statistic Office in the “Ministry of Statistic and Program Implementation”.
It covers the items and services included in CPI Education transport, food communications, recreation housing, clothing, and medical services. CPI is released monthly. The base year of CPI is the calendar year.
Key Difference
Wholesale price index (WPI) and the consumer price index (CPI) are the variations in the cost of services or goods.
The wholesale index is a measure of how much change price of the wholesale index is, whereas the index for consumer prices is how much change retail price; therefore, it is more beneficial to consumers than businesspeople.
1) The full version of WPI is Wholesale Price Index, and the complete form of CPI is Consumer Price Index.
2) WPI is a measure of the change in the price of goods sold in bulk by wholesalers. CPI measures the variation in the cost of selling products or services at a retail or directly to consumers.
3) WPI only applies to items, whereas CPI is for goods and services.
4) CPI is the initial stage of WPI and the last stage of CPI.
5) Wholesalers and manufacturers are the ones who pay the price in WPI, and CPI is paid by consumers.
6) The items covered in WPI include fuel, power, and manufacturing items, and in CPI, transportation, education, food communications, recreation housing, clothing, and medical services are all covered.
7) WPI is utilized by only a handful of countries, whereas 157 countries use CPI.
8) The date of publication in the case of WPI is the basis for the weekly magazine for the primary articles and power and fuel for the remaining things published monthly. In contrast, for CPI, the publication is every month.
9) WPI focuses on the cost of products exchanged between business houses and consumers, while CPI focuses on purchasing goods from consumers.