Wholesale Price Index (WPI)

WPI Index fell to a 40-month low of 0.2% YoY in October 2019.

Published monthly by the Ministry of Commerce and Industry. Updated until October 2019. (Published on November 14, 2019) 
Note: WPI Food Index consists of ‘Food Articles’ from Primary Articles group and ‘Food Product’ from Manufactured Products. Core WPI represents non-food manufacturing.

Recent Data Trend

The Wholesale Price Index (WPI), which is a measure of inflation in wholesale goods, fell to a 40-month low of 0.2% YoY in October 2019 as against 0.3% YoY in the previous month. The decline is majorly due to the consequent downtrend in the prices of fuel & power and manufactured goods.

Fuel and power witnessed a deflation for October 2019 at 8.3% YoY as compared to a deflation of 7.1% YoY in September 2019. The manufacturing WPI index for October is at -0.8 % YoY as compared to -0.4% YoY in September 2019. The decline in the Manufacturing WPI Index for the last 12 months reflects a contraction in the production activities across all the industries in recent months, which is evident from the declining IIP Index from July 2019. This continuous decline in manufacturing WPI is of a major worry for the economy as it has the maximum weightage of 64.3% in the WPI index estimation.

The WPI food index has increased from 6.0% YoY in September 2019 to 7.7% YoY for October 2019, which is a 39-Month high. Unseasonal rains and floods across the country, causing damage to the crops in recent months, have been a major contributing factor to the increase in food prices at the production level.

While the WPI Index is at a steady decline, the CPI Index, which measures the inflation in consumer goods is at a rising trend. This divergence is due to the differences in weightage given to the products in WPI and CPI index.

The further decline in the WPI in the coming months could be of major concern to the already decelerating economy as it signals a fall in consumer demand, which in turn would impact production activities.

Brief Overview

Wholesale Price Index (WPI) represents the price of representative commodity basket of 697 items at the wholesale level, i.e. goods traded in bulk and between organizations, not the end consumers. It is a measure of inflation at the wholesale level. The significant components of WPI include Manufactured Products, Primary Articles, Fuel, and Power in the decreasing order of weight-age to the stated elements. The purpose of the WPI is to monitor price movements that reflect supply and demand in industry, manufacturing, and construction. The WPI index helps in analyzing both macroeconomic and microeconomic conditions.

The WPI inflation has remained in the negative zone for the entire year of 2015 owing to the weak global prices of oil. The wholesale prices fell by 5.1% in August 2015, the highest fall of all time.

The  Office of the  Economic  Adviser in the  Department of  Industrial  Policy and Promotion,  Ministry of  Commerce  &  Industry is responsible for compiling  WPI and releasing it. Since 1947 the index is being regularly published. The latest series of WPI uses the base year as 2011-12. For more information, please visit the official website.  

Wholesale Price Index, Sub-group: Manufacturing

Wholesale Price Index, Sub-group: Primary Articles

Wholesale Price Index, Sub-group: Fuel and Power

Next Release Date: December 16, 2019

Wholesale Price Index-Quarterly

Wholesale Price Index-Annual

Note: Here year represent fiscal year. For example 2010 refers to the period April 2010-March 2011, and so on. 
The entire series 1970-2017 is on the same base year (2011-12=100). The data post-2012 is in the base year 2011-12. For data, before 2012, we have used yearly growth rates obtained from a series of the different base year. For example, the index of 2010 (on 2011-12 base year) has been obtained preserving its growth rate (on 2004-05 base year) and using 2011-12 index value as 100 and dividing it by the growth rate for 2010 obtained earlier.