India measures price changes with two main indices. The Consumer Price Index (CPI) tracks the retail prices that households pay for goods and services. The Wholesale Price Index (WPI) tracks the prices producers receive for goods at the first point of bulk sale. They measure different things, so they often tell different stories. In September 2026, CPI inflation was 5.54% and WPI inflation was 11.39%. In July 2023 the gap ran the other way: CPI inflation was 7.44% while WPI showed deflation of −1.36%. Both indices have new base years in 2026. The CPI moved to 2024=100 in February, and the WPI moved to 2022-23=100 in June. This part explains what each index measures, how the numbers are built and calculated, why they diverge and who uses which.
The RBI's inflation target is set in terms of CPI inflation. Part 3, how monetary policy works in India, covers the framework, and Part 7, inflation targeting in India, covers the target in depth. This part is about the measuring rods themselves.
In the news
- 14 Oct 2026: WPI inflation hits 11.39%, the highest in the new series. Wholesale inflation for September rose from 9.92% in August. Fuel and power inflation was 25.85%, and mineral oils were up 40.02% on the year. Why it matters for the exam: WPI inflation is now about twice CPI inflation, and this example shows how much more weight oil carries in the WPI.
- 12 Oct 2026: CPI inflation rises to 5.54% in September. Provisional NSO data put rural inflation at 6.08%, urban at 4.88% and food (CFPI) at 7.74%. Onion prices were up 108% on the year. Why it matters for the exam: the figure is still inside the 2–6% band, but it is close to the top.
- 7 Oct 2026: RBI raises repo to 5.50% and projects CPI inflation of 5.2% for 2026-27. The Governor said core inflation had risen to 4.2% in August after three months at 3.9%. He also cited a re-escalation of the West Asia conflict, with the Indian crude basket averaging US$116.1 a barrel in September. Why it matters for the exam: the MPC reacts to CPI, not WPI, and watches core inflation for signs that price rises are spreading.
- 30 Sep 2026: CPI-IW inflation at 4.96% for August. The Labour Bureau's index for industrial workers (2016=100) rose to 154.4. Why it matters for the exam: CPI-IW drives dearness allowance, and the July 2026 DA revision depends on it.
- 15 Jun 2026: New WPI series, base 2022-23, and producer price indices. The Office of the Economic Adviser replaced the 2011-12 series and launched Output and trial Input Producer Price Indices and services PPIs for seven services. The WPI will run alongside the PPI for five years and then be discontinued. Why it matters for the exam: the WPI base is now 2022-23, not 2011-12, and India has started moving from WPI to PPI.
- 14 May 2026: WPI inflation jumps to a 42-month high in April. It reached about 8.3% (later revised to 8.36%), up from about 3.9% in March. Fuel prices drove the rise after the West Asia crisis disrupted shipping through the Strait of Hormuz. Why it matters for the exam: it shows how an oil shock reaches WPI faster and harder than CPI.
- 27 Feb 2026: New GDP series with base 2022-23. MoSPI moved the national accounts base from 2011-12 to 2022-23 and introduced double deflation for manufacturing. Why it matters for the exam: the WPI base is chosen to match the GDP base, because WPI is the main GDP deflator.
- 12 Feb 2026: New CPI series, base 2024=100. The first release put January 2026 inflation at 2.75% (provisional, later revised to 2.74%). The basket grew from 299 to 358 items, and the weight of food and beverages fell from 45.86% to 36.75%. Why it matters for the exam: questions on the new base, the item count and the weights are very likely.
What each index measures
The Consumer Price Index
A CPI measures the change over time in the retail prices of a fixed basket of goods and services that households buy for consumption. Prices are retail prices, including taxes and trade margins, collected in markets where households shop. The weights come from household spending as recorded in a consumption expenditure survey.
India has four CPIs:
| Index | Compiled by | Base | Covers | Main use |
|---|---|---|---|---|
| CPI (Rural, Urban, Combined) | National Statistics Office (NSO), MoSPI | 2024=100 | All households | Headline inflation; RBI's target |
| CPI-IW (Industrial Workers) | Labour Bureau, Ministry of Labour | 2016=100 | Industrial worker households in 88 centres | Dearness allowance of government employees |
| CPI-AL (Agricultural Labourers) | Labour Bureau | 2019=100 | Agricultural labour households | Minimum wages in agriculture, MGNREGA wages |
| CPI-RL (Rural Labourers) | Labour Bureau | 2019=100 | Rural labour households | Minimum wages |
The CPI Combined is the headline figure that newspapers call "retail inflation". MoSPI first published the rural, urban and combined CPIs in January 2011, on base 2010=100. The base moved to 2012 and, from the January 2026 index, to 2024.
The Labour Bureau's indices are older. The CPI-IW moved from base 2001 to 2016=100 on 22 October 2020, with the index for September 2020. Prices come from 317 markets in 88 industrial centres, and the linking factor to the old series is 2.88. The CPI-AL and CPI-RL moved from base 1986-87 to 2019=100 from the June 2025 index. That was their first revision in three decades, and coverage grew from 20 to 34 states and UTs and to 787 sample villages.
The Wholesale Price Index
The WPI measures the average change in the prices of goods traded in bulk. It is compiled by the Office of the Economic Adviser (OEA) in the Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce and Industry, not by MoSPI.
The name is now partly historical. Since the 2011-12 series, the WPI has used basic prices: what the producer receives, excluding taxes such as GST, including any subsidy, and excluding trade and transport margins. Prices are collected ex-factory for manufactured goods, ex-mine for minerals and at the mandi for farm produce. In concept, the WPI is therefore close to a producer price index.
The WPI covers goods only. It has no services: no rent, no school fees, no doctor's fees, no haircuts. That is the single biggest structural difference from the CPI.
Base years and the new series
CPI: base 2024=100
On 12 February 2026, MoSPI released the first CPI on base 2024=100, for January 2026. The main changes:
- Weights come from the Household Consumption Expenditure Survey (HCES) 2023-24. Base prices were collected from January to December 2024.
- Basket: 358 items, up from 299. Goods rose from 259 to 308, and services from 40 to 50.
- Classification: 12 divisions under the UN's COICOP 2018, in place of the old 6 groups. Below them are 43 groups, 92 classes and 162 subclasses.
- Coverage: 1,465 villages and 1,395 urban markets in 434 towns. Price collectors use handheld devices (Computer Assisted Personal Interviewing).
- Online prices: e-commerce prices are collected weekly as an extra market in 12 towns with more than 25 lakh people. Airfares and OTT subscriptions are also priced online. Rail fares, postal charges and fuel prices come from administrative data.
- New items include rural house rent (included for the first time), streaming services, value-added dairy products, pen drives, babysitters and exercise equipment. VCRs, radios, tape recorders and second-hand clothing were removed.
- Linking factor: to compare with the 2012 series, multiply an old combined index by 0.5267. The two series can be linked only at the general index level.
WPI: base 2022-23
On 15 June 2026, the OEA released the WPI with base 2022-23, starting with the May 2026 index, and stopped the 2011-12 series. This was the eighth base revision since 1952-53. A Working Group under Prof. Ramesh Chand of NITI Aayog, set up on 30 December 2024, recommended it in April 2026. The base matches the new GDP base, because WPI is used mainly as a GDP deflator.
- Items: 957, up from 697. Price quotations rose from 8,331 to 15,254.
- Weights are based on Gross Value of Output (domestic production) instead of the old Net Traded Value (output plus imports minus exports).
- Crude petroleum and natural gas moved from Primary Articles to Fuel and Power.
- Electricity is now split into coal-based and gas-based thermal, hydro, nuclear, solar and wind power. Coal auction prices and Indian Gas Exchange prices were added.
- Missing prices are filled by "targeted mean imputation" instead of carrying forward the last price.
- Linking factor for all commodities: 1.53.
- Producer Price Indices: an Output PPI, a trial Input PPI for manufacturing and quarterly services PPIs for seven services (banking, securities transactions, insurance, pension fund management, railways, air passenger travel and telecom). The WPI will be released alongside the PPI for five years and then discontinued.
So if an exam asks for "the base year of WPI" today, the answer is 2022-23. Older guides that say 2011-12 are out of date.
Weights and composition
CPI weights, old and new
| CPI 2024 division | Weight (%) |
|---|---|
| Food and beverages | 36.75 |
| Housing, water, electricity, gas and other fuels | 17.67 |
| Transport | 8.80 |
| Clothing and footwear | 6.38 |
| Health | 6.10 |
| Personal care, social protection and miscellaneous | 5.04 |
| Furnishings, household equipment and maintenance | 4.47 |
| Information and communication | 3.61 |
| Restaurants and accommodation services | 3.35 |
| Education services | 3.33 |
| Paan, tobacco and intoxicants | 2.99 |
| Recreation, sport and culture | 1.52 |
In the 2012 series, the six groups were food and beverages 45.86%, paan and tobacco 2.38%, clothing and footwear 6.53%, housing 10.07%, fuel and light 6.84% and miscellaneous 28.32%. The headline change is the fall in the food weight by about 9 percentage points. Housing gained because rural rent was added and because the new division also includes electricity and fuel. Since food prices are the most volatile part of the basket, a smaller food weight should make headline CPI a little less jumpy.
WPI weights, old and new
| WPI major group | 2011-12 series (%) | 2022-23 series (%) |
|---|---|---|
| Primary Articles | 22.62 | 22.76 |
| Fuel and Power | 13.15 | 14.11 |
| Manufactured Products | 64.23 | 63.13 |
| Memo: WPI Food Index | — | 24.99 |
Within the new series, Food Articles weigh 15.98%, Mineral Oils 8.19%, Electricity 4.46%, Manufacture of Food Products 9.02% and Basic Metals 8.41%. The WPI Food Index (24.99%) combines Food Articles from Primary Articles with Manufacture of Food Products. The CPI food share is far larger, while metals, chemicals and machinery, which households rarely buy directly, carry much more weight in the WPI.
What each one leaves out
- WPI excludes services entirely: no rent, health care, school fees, transport services or restaurant meals. In the CPI, the divisions that hold most services (housing, health, transport, education, restaurants) carry about 39% of the weight, although they also contain some goods such as medicines, household fuel and vehicles.
- CPI excludes intermediate and capital goods that households do not buy: iron ore, steel billets, industrial chemicals, machinery.
- WPI excludes taxes and retail margins. CPI prices include GST and the shopkeeper's margin.
Headline and core inflation
Headline inflation is the YoY change in the all-items index. Core inflation strips out the most volatile items to show the underlying trend. In India, core usually means CPI excluding food and beverages and fuel (electricity, gas and other household fuels, and petrol and diesel for vehicles). MoSPI does not publish an official core index. The RBI and analysts compute it from the published sub-indices.
Gold and silver now complicate core. Silver jewellery inflation was 87.8% in September 2026 and the "other personal effects" group (which includes jewellery) was up 38.69%, so the RBI also tracks core excluding precious metals. In its October 2026 statement it put August core at 4.2% and core excluding precious metals at 2.9%. Crisil estimated core excluding gold and silver at 3.2% in September. Central banks look at core because monetary policy cannot change the onion harvest, but it can influence the broad price increases that core captures. The RBI's target is headline CPI, not core.
How YoY inflation is calculated
The formula
The YoY inflation rate for month t compares the index with the same month a year earlier:
Inflation (%) = (Iₜ − Iₜ₋₁₂) ÷ Iₜ₋₁₂ × 100
Comparing with the same month last year removes normal seasonal swings, such as winter vegetable prices.
Worked example 1: CPI, September 2026
From MoSPI's release:
- All-India CPI (combined), September 2025: 103.74
- All-India CPI (combined), September 2026: 109.49 (provisional)
- Change = 109.49 − 103.74 = 5.75 index points
- Inflation = 5.75 ÷ 103.74 × 100 = 5.54%
Note the difference between points and per cent. The index rose 5.75 points, but inflation is 5.54% because the base is 103.74, not 100. MoSPI computes rates from unrounded indices, so recalculating from the published two-decimal figures can be off by 0.01 point. For example, August 2026 works out to 4.82% from rounded numbers against the published 4.83%.
Worked example 2: WPI, September 2026
- WPI (all commodities), September 2025: 101.0
- WPI, September 2026: 112.5 (provisional)
- Inflation = (112.5 − 101.0) ÷ 101.0 × 100 = 11.5 ÷ 101.0 × 100 = 11.39%
Worked example 3: a group's rough contribution
Food and beverages has a weight of 36.75% and inflation of 7.36% in September 2026. As a rough guide, its contribution is 0.3675 × 7.36 ≈ 2.7 percentage points of the 5.54% headline, about half of it. (An exact contribution also adjusts for how far each group's index has moved since the base, but the weight × inflation shortcut is close enough for a quick estimate.)
Base effects
What a base effect is
YoY inflation depends on two things: how much prices rose this month (the momentum) and how much they rose in the same month last year. A big jump a year ago drops out of the comparison and pulls inflation down. That is a favourable base effect. A fall in prices a year ago does the opposite and is an unfavourable base effect. A good approximation:
Change in YoY inflation ≈ this month's month-on-month change − the month-on-month change a year earlier
Worked example 4: February 2026, an unfavourable base
- January to February 2025: the index fell from 101.67 to 101.32, a change of −0.34%.
- January to February 2026: the index rose from 104.45 to 104.57, a change of only +0.11%.
- Predicted change in YoY inflation ≈ 0.11 − (−0.34) = +0.45 percentage points.
- Actual: inflation rose from 2.74% in January to 3.21% in February (+0.47).
Prices barely moved in February 2026, but headline inflation still rose almost half a point. Most of the rise was a base effect.
Worked example 5: September 2026, no help from the base
- August to September 2025: the index was flat (103.74 to 103.74), a change of 0.00%.
- August to September 2026: 108.74 to 109.49, a change of +0.69%.
- Predicted rise ≈ 0.69 − 0.00 = 0.69 points. Actual: 4.83% to 5.54% (+0.71).
Here the whole rise came from fresh momentum, the kind of rise that worries the MPC.
Worked example 6: what October 2026 could look like
The index was also flat from September to October 2025 (103.74 both months), so the base will neither help nor hurt in October 2026.
- If the October 2026 index stays at 109.49, inflation stays at 109.49 ÷ 103.74 − 1 = 5.54%.
- If it rises 0.5% to about 110.04, inflation becomes 110.04 ÷ 103.74 − 1 = 6.07%, above the 6% upper tolerance.
Why CPI and WPI inflation diverge
The OEA's own FAQ lists the reasons. In short:
- Different prices. WPI uses first-stage basic prices, while CPI uses retail prices that include taxes and margins. When the cost of crude oil changes, the price received by producers moves a lot more, in percentage terms, than the retail price, which includes fixed taxes and margins.
- Different weights. CPI weights come from household spending, and WPI weights from the value of production. Food is 36.75% of CPI but about 25% of WPI. Fuel and power plus metals and chemicals are much heavier in WPI.
- Services. Rent, health care, school fees, transport services and restaurant meals are a large part of the CPI and are not in the WPI at all. Services prices tend to move slowly and steadily.
- Global goods. WPI is full of traded goods (crude, metals, chemicals) whose prices follow world markets and the rupee. CPI has many non-tradables.
- Lags. Wholesale price changes reach retail shelves with a delay, sometimes months later and sometimes only in part.
Three recent episodes
| Month | CPI inflation | WPI inflation | Story |
|---|---|---|---|
| July 2023 | 7.44% | −1.36% | Tomato and vegetable prices pushed retail inflation up; falling global oil and metal prices kept WPI negative (April–October 2023) |
| October 2025 | 0.25% | −1.21% | GST cuts from 22 September 2025, falling food prices and a favourable base sent both to record lows |
| September 2026 | 5.54% | 11.39% | The West Asia oil shock hit WPI fuel (25.85%) and mineral oils (40.02%); CPI fuel inflation was only about 5% |
The 2023 and 2025 figures are from the old series (CPI base 2012 and WPI base 2011-12). The 2026 figures are from the new series.
| 2026 | CPI (%) | WPI (%) |
|---|---|---|
| January | 2.74 | 1.19 |
| February | 3.21 | 2.18 |
| March | 3.40 | 3.98 |
| April | 3.48 | 8.36 |
| May | 3.93 | 9.88 |
| June | 4.38 | 9.97 |
| July | 4.45 | 9.78 |
| August | 4.83 | 9.92 |
| September (provisional) | 5.54 | 11.39 |
The table shows the mechanism clearly. In April, WPI inflation more than doubled in one month as fuel and power inflation reached about 25%. CPI inflation hardly moved, because petrol, diesel and LPG are a much smaller share of household spending and their retail prices moved far less. By the summer, cost pressure was passing through to transport services for goods (CPI inflation 14.73% in September), restaurants (9.36%) and food. This is the lag at work.
A large, persistent gap with WPI above CPI usually squeezes producers' margins, because input costs rise faster than the prices they can charge consumers. A gap the other way, as in 2023, usually means retail food inflation is running ahead of everything else.
Who uses which index
| Use | Index | Detail |
|---|---|---|
| Inflation target | CPI Combined | 4% ± 2% under Section 45ZA of the RBI Act, for 1 April 2026 to 31 March 2031 |
| GDP deflator | Mostly WPI (now also PPI) | Converts nominal output to real output; the new GDP series uses double deflation for manufacturing |
| IIP | WPI | Deflates nominal production values |
| Dearness allowance | CPI-IW | 12-month average of the all-India CPI-IW under the 7th Pay Commission formula |
| Rural minimum wages, MGNREGA | CPI-AL, CPI-RL | Annual wage revisions |
| Price escalation clauses | WPI | Construction and supply contracts; one reason WPI will run for five more years |
| Tax indexation | Cost Inflation Index | Notified by CBDT under the Income-tax Act |
Why the RBI targets CPI
Until 2014, the RBI watched WPI as its main inflation gauge. The Urjit Patel Committee (January 2014) recommended CPI Combined as the nominal anchor. Its reasons were that CPI reflects the cost of living that shapes people's inflation expectations and wage demands, while WPI leaves out services and is dominated by globally traded goods the RBI cannot influence. The February 2015 agreement with the government and the 2016 amendment to the RBI Act made CPI the legal target. The CPI's new 2024 base did not change the target itself. The 4% ± 2% band now simply applies to the new index.
Dearness allowance
Central government DA is revised twice a year, effective 1 January and 1 July, using the 12-month average of the all-India CPI-IW. DA was raised from 58% to 60% of basic pay from 1 January 2026. The July 2026 revision was still awaiting Cabinet approval in mid-October 2026.
Release calendar
| Index | Released by | Day | Time |
|---|---|---|---|
| CPI (R, U, C) | NSO, MoSPI | 12th of the following month (next working day if a holiday) | 4:00 pm |
| WPI, Output PPI, trial Input PPI | OEA, DPIIT | 14th of the following month (next working day if a holiday) | 12:00 noon |
| CPI-IW | Labour Bureau | Last working day of the following month | — |
| Services PPIs | OEA, DPIIT | Quarterly, 55 days after the quarter ends | — |
The CPI for a month is provisional when first released and final a month later. A provisional WPI is finalised two months later. For example, the September 2026 release finalised July 2026 at an unchanged 9.78%. The October 2026 CPI comes out on 12 November 2026 and the October WPI on 16 November 2026 (14 November is a Saturday).
The latest prints: September 2026
CPI (12 October 2026): headline 5.54% (rural 6.08%, urban 4.88%); CFPI food inflation 7.74%. By division, the highest rates were personal care and miscellaneous (13.75%, driven by jewellery), restaurants and accommodation (9.36%) and food and beverages (7.36%). The lowest was health (1.40%). Onion (108.09%), silver jewellery (87.80%) and ginger (62.85%) led the item list, while potato (−11.50%) and tomato (−8.62%) fell. Tamil Nadu (6.81%) had the highest inflation of the large states.
WPI (14 October 2026): headline 11.39%, index 112.5. Primary articles 8.67%, fuel and power 25.85%, manufactured products 9.76%, WPI Food Index 8.66%. Crude petroleum and natural gas was up 57.32%, and basic metals 16.96%.
Common exam traps
"WPI base year is 2011-12." Not any more. It has been 2022-23 since the release of 15 June 2026. The CPI base is 2024, the CPI-IW base is 2016 and the CPI-AL/RL base is 2019.
Who compiles what. CPI (R/U/C): NSO, MoSPI. WPI: Office of the Economic Adviser, DPIIT, Ministry of Commerce and Industry. CPI-IW, CPI-AL and CPI-RL: Labour Bureau, Ministry of Labour and Employment (Shimla and Chandigarh). The RBI compiles none of them.
"WPI includes services." It does not. The new services PPIs are separate indices.
Points vs per cent. A rise from 103.74 to 109.49 is 5.75 points but 5.54%.
Low inflation is not falling prices. If inflation falls from 5.54% to 4%, prices are still rising, only more slowly. Only negative inflation (as in WPI in 2023 and October 2025) means prices are lower than a year ago.
Base effect direction. A high index a year ago gives a favourable base (lower YoY now). A low or falling index a year ago gives an unfavourable base (higher YoY now).
Food weight. The CPI food and beverages weight is 36.75% in the 2024 series. 45.86% was the old 2012 figure.
Key facts at a glance
| CPI compiled by | National Statistics Office (NSO), MoSPI |
| CPI base | 2024=100 (first release 12 February 2026, for January 2026) |
| CPI basket | 358 items (308 goods, 50 services); 12 COICOP 2018 divisions |
| CPI food and beverages weight | 36.75% (was 45.86% in the 2012 series) |
| CPI weights source | Household Consumption Expenditure Survey 2023-24 |
| CPI release | 12th of the following month, 4:00 pm |
| WPI compiled by | Office of the Economic Adviser, DPIIT, Ministry of Commerce and Industry |
| WPI base | 2022-23 (from the May 2026 index, released 15 June 2026) |
| WPI basket | 957 items; Primary 22.76%, Fuel and Power 14.11%, Manufactured 63.13% |
| WPI release | 14th of the following month, 12:00 noon |
| WPI future | Runs alongside the new PPI for five years, then discontinued |
| CPI-IW | Labour Bureau; base 2016=100; linking factor 2.88; used for DA |
| CPI-AL / CPI-RL | Labour Bureau; base 2019=100 since the June 2025 index |
| RBI target | CPI Combined, 4% ± 2%, 1 April 2026 to 31 March 2031 |
| CPI inflation, September 2026 | 5.54% (provisional); food 7.74% |
| WPI inflation, September 2026 | 11.39% (provisional); fuel and power 25.85% |
Exam corner: what to remember
- CPI = retail prices, goods and services, household weights. WPI = basic prices at first sale, goods only, production weights.
- NSO (MoSPI) compiles the CPI. The OEA (DPIIT) compiles the WPI. The Labour Bureau compiles CPI-IW, CPI-AL and CPI-RL.
- New bases: CPI 2024 (12 February 2026), WPI 2022-23 (15 June 2026), CPI-IW 2016, CPI-AL/RL 2019.
- CPI basket 299 → 358 items. Food and beverages weight 45.86% → 36.75%. 12 divisions (COICOP 2018). Online prices are collected in 12 towns.
- WPI items 697 → 957. Weights now use gross value of output. Crude oil and gas moved to Fuel and Power. The WPI will be phased out for the PPI after five years.
- YoY inflation = (Iₜ − Iₜ₋₁₂) ÷ Iₜ₋₁₂ × 100. Change in YoY ≈ momentum now − momentum a year ago.
- The Urjit Patel Committee (2014) chose CPI Combined as the anchor. The RBI targets headline CPI, not core and not WPI.
- September 2026: CPI 5.54%, WPI 11.39%, CFPI 7.74%, fuel and power (WPI) 25.85%.
- Releases: CPI on the 12th at 4 pm; WPI on the 14th at noon.
For exam-specific syllabus and pattern details, see our pages for RBI Grade B, SBI PO and IBPS PO.
Test yourself
Which body compiles the Wholesale Price Index in India?
Show answer
Answer: (c) The WPI is compiled by the Office of the Economic Adviser in the Department for Promotion of Industry and Internal Trade, Ministry of Commerce and Industry.
The new WPI series released on 15 June 2026 has the base year
Show answer
Answer: (b) The 2022-23 series replaced the 2011-12 series from the May 2026 index, matching the new GDP base year.
In the CPI series with base 2024=100, the weight of food and beverages is about
Show answer
Answer: (a) It fell from 45.86% in the 2012 series. 24.99% is the weight of the WPI Food Index.
The All-India CPI was 103.74 in September 2025 and 109.49 in September 2026. YoY inflation for September 2026 is closest to
Show answer
Answer: (c) (109.49 − 103.74) ÷ 103.74 × 100 = 5.54%; 5.75 is the change in points, not per cent.
A price index fell 0.34% from January to February last year and rose 0.11% from January to February this year. If January's YoY inflation was 2.74%, February's will be about
Show answer
Answer: (b) Change ≈ 0.11 − (−0.34) = +0.45 points, so about 3.19%. The actual February 2026 figure was 3.21%, an unfavourable base effect.
Which of the following is NOT part of the WPI basket?
Show answer
Answer: (c) WPI covers goods only. Services such as education are in the CPI and, for seven services, in the new services PPIs.
Dearness allowance of central government employees is linked to
Show answer
Answer: (a) DA is revised twice a year on the 12-month average of the Labour Bureau's CPI-IW (base 2016=100).
WPI inflation for September 2026, released on 14 October 2026, was
Show answer
Answer: (d) It rose from 9.92% in August, with fuel and power inflation at 25.85%. 5.54% is CPI inflation and 7.74% is CPI food inflation.
In the new WPI series, crude petroleum and natural gas has been moved to
Show answer
Answer: (b) It moved from Primary Articles to Fuel and Power to bring all fuels into one major group.
Which committee recommended that the RBI use CPI Combined, rather than WPI, as its nominal anchor?
Show answer
Answer: (a) The Urjit Patel Committee's report of January 2014 recommended CPI Combined. Ramesh Chand chaired the WPI 2022-23 working group.
Further reading
- MoSPI, First Press Release of CPI on Base 2024=100 (12 February 2026): the technical note, weights, linking factors and FAQs on the new CPI in one document.
- OEA, Press release on the new WPI and PPI series, base 2022-23 (15 June 2026): the official account of what changed in the WPI and the plan to move from WPI to PPI.
- OEA, FAQs on the new WPI and PPIs (base 2022-23): clear answers on weights, item selection and, in question 31, why WPI and CPI diverge.
- OEA, Report of the Working Group on WPI and PPI (Ramesh Chand, 2026): the full report behind the 2022-23 base, for anyone preparing for the ESI paper.
- Report of the Expert Committee to Revise and Strengthen the Monetary Policy Framework (Urjit Patel Committee, 2014): the case for CPI over WPI as the anchor of monetary policy.
- RBI, Governor's Statement, 7 October 2026: a live example of how the RBI reads headline, food, fuel and core CPI and sets its projections.
- PIB, Labour Bureau releases CPI-IW with base 2016=100 (22 October 2020): why and how the CPI-IW base was revised, with the 2.88 linking factor.
Sources
- MoSPI, Press Release of CPI on Base 2024=100 for September 2026 (12 October 2026): CPI 5.54%, rural 6.08%, urban 4.88%, CFPI 7.74%; division and group inflation; top items; state figures; monthly indices January 2025 to September 2026 and inflation for 2026; 1,407 urban markets including online; next release 12 November 2026 (accessed 24 October 2026)
- MoSPI, First Press Release of CPI on Base 2024=100 (12 February 2026): January 2026 inflation 2.75%; HCES 2023-24; 299 to 358 items; COICOP 2018 structure; old and new weights; markets and online prices; CAPI; new and removed items; linking factor 0.5267; inflation formula; CPI since January 2011 (accessed 24 October 2026)
- OEA, DPIIT, WPI press release for September 2026 (14 October 2026): WPI 11.39%, index 112.5; group weights, indices and inflation; monthly WPI inflation September 2025 to September 2026; July 2026 final 9.78%; release on the 14th; October release on 16 November 2026 (accessed 24 October 2026)
- OEA, DPIIT, Press release on new WPI and PPI series, base 2022-23 (15 June 2026): new base, 957 items, GVO weights, crude moved to Fuel and Power, linking factor 1.53, PPIs and services PPIs, WPI to be discontinued after five years, basic price definition, release schedule (accessed 24 October 2026)
- OEA, DPIIT, FAQs on the new series of WPI and PPIs: eight base revisions; Ramesh Chand Working Group; quotations 8,331 to 15,254; old and new major-group weights; reasons for WPI–CPI divergence; uses of WPI (accessed 24 October 2026)
- OEA, DPIIT, Note for WPI users (1 June 2026): new series to be released on 15 June 2026; Working Group constituted 30 December 2024, report April 2026 (accessed 24 October 2026)
- MoSPI, CPI press release for October 2025 (12 November 2025): CPI inflation 0.25%, lowest of the 2012 series, attributed to GST cuts and a favourable base (accessed 24 October 2026)
- Business Standard, 14 November 2025: WPI inflation −1.21% in October 2025 (accessed 24 October 2026)
- OEA, WPI summary for July 2023: WPI inflation −1.36% in July 2023 against −4.12% in June (accessed 24 October 2026)
- Business Standard, 12 September 2023: CPI inflation of 7.44% in July 2023 (accessed 24 October 2026)
- The Tribune, November 2023: WPI negative for seven months from April to October 2023 (accessed 24 October 2026)
- Business Today, 14 May 2026: April 2026 WPI inflation of 8.3%, a 42-month high, driven by fuel after the West Asia crisis and disruption in the Strait of Hormuz (accessed 24 October 2026)
- RBI, Governor's Statement, 7 October 2026: repo 5.50%; CPI projection 5.2% for 2026-27; core 4.2% in August, 2.9% excluding precious metals; fuel inflation 5.2% in August; Indian crude basket US$116.1 a barrel in September (accessed 24 October 2026)
- AgroSpectrum, 13 October 2026, citing Crisil Intelligence: core inflation excluding gold and silver 3.2% in September 2026 (accessed 24 October 2026)
- Labour Bureau, CPI-IW press release for August 2026 (30 September 2026), copy hosted by StaffNews: CPI-IW 154.4, inflation 4.96%; 317 markets in 88 centres (accessed 24 October 2026)
- PIB, CPI-IW new series base 2016=100 (22 October 2020): base revision from 2001, linking factor 2.88, first index for September 2020 (accessed 24 October 2026)
- PIB, CPI-AL and CPI-RL on base 2019=100: new base replacing 1986-87; 34 states and UTs; 787 villages; June 2025 first index (accessed 24 October 2026)
- Business Standard, August 2025: CPI-AL/RL base revised after three decades; use in minimum wages and MGNREGA (accessed 24 October 2026)
- Vision IAS, 28 February 2026: new GDP series with base 2022-23 released on 27 February 2026, with double deflation (accessed 24 October 2026)
- GConnect, 2026: DA raised from 58% to 60% from 1 January 2026 under the 7th Pay Commission formula (accessed 24 October 2026)
- PSU Connect, October 2026: July 2026 DA revision pending in mid-October 2026 (accessed 24 October 2026)
- Report of the Expert Committee to Revise and Strengthen the Monetary Policy Framework (2014): CPI Combined recommended as the nominal anchor (accessed 24 October 2026)