Sunday 12 July 2009

WPI & CPI - THE ESTRANGED BROTHERS

http://in.news.yahoo.com/43/20090712/836/tbs-wholesale-consumer-price-indices-to.html

This topic is so welcome for the people who dont understand why the hell are things so expensive while your inflation is all the time in negative figures.

Inflation can be based on two indices, WPI and CPI.
Why should I care if the inflation is based on WPI or CPI ? (for those from non-economics, non-finance........ background, WPI based inflation is around -1.5 where as that based on CPI is around +10) .

Now try and recollect what infaltion index your sabjiwala follows and you will understand the futility of maintaining the two indices.

Going towards a single indicator is one very good step.

Great first statisitical step Pranab da, atleast after the big budget that supposedly fizzled out.

Now before pushing off have a look at the chinese Indices also: http://www.chinadaily.com.cn/bizchina/2009-07/16/content_8435537.htm

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