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Today i.e. on June 13, the wholesale inflation (WPI) figures for May will be released. According to experts, there may be a decline in it. Earlier in the month of April, wholesale inflation was 1.26%, which was the highest level in 13 months.
Whereas a month before this, in March 2024, it was 0.53%. Whereas wholesale inflation was 0.20% in February and 0.27% in January. There may be a rise in the stock market today due to the expectation of decline in inflation.
Retail inflation declined in May
Earlier yesterday i.e. on June 12, retail inflation figures for May were released. According to this, retail inflation in May was 4.75%. This is a 12-month low. Whereas a month ago i.e. in April, retail inflation had come down to 4.83%.
Impact of WPI on common man
Prolonged increase in wholesale inflation has a negative impact on most productive sectors. If wholesale prices remain high for too long, producers pass the burden on to consumers. Government can control WPI only through tax.
For example, in the situation of sharp increase in crude oil, the government had reduced the excise duty on fuel. However, the government can reduce tax cuts only within a limit. In WPI, more weightage is given to factory related goods like metal, chemical, plastic, rubber.
How is inflation measured?
There are two types of inflation in India. One is retail, i.e. retail and the other is wholesale inflation. Retail inflation rate is based on the prices paid by ordinary consumers. It is also called Consumer Price Index (CPI). At the same time, Wholesale Price Index (WPI) means the prices that one businessman charges from another businessman in the wholesale market.
Different items are included to measure inflation. For example, the share of manufactured products in wholesale inflation is 63.75%, primary articles like food 20.02% and fuel and power 14.23%. At the same time, the share of food and products in retail inflation is 45.86%, housing is 10.07% and other items including fuel also have a share.
