What is the difference between WPI and CPI? - ProProfs Discuss
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What is the difference between WPI and CPI?

Asked by R. Jones, Last updated: May 16, 2022

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Cesar H. Pablo

Cesar H. Pablo

Cesar H. Pablo
Cesar H. Pablo, Journalist

Answered Apr 14, 2020

WPI or Wholesales Price Index and CPI or Consumer Price Index are two methods used by most countries in other to calculate the inflation rate. If you are using WPI to calculate the inflation rate, you are only using the wholesale prices of commodities to calculate the inflation rate.

Wholesale prices are used because you can easily get the needed data as per the prices of each good. Before you can get the inflation rate using WPI for a particular year, you will need to find the difference between WPI at the beginning of the year and its figure at the end of the year.

On the other hand, CPI or consumer price index takes into account the changes in consumer prices for different kinds of commodities. Most people believe that CPI is the best method that can accurately produce the inflation rate because it reveals the actual cost of living in a particular country.

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