One number every month

Watch the needle move.

Every month India publishes how fast prices rose over the past year. Markets watch it because it hints at what the **RBI** will do next.

How inflation is measured

• Consumer Price Index (CPI) what you pay in shops — Tracks retail prices across many goods and services, in towns and villages. As a consumer, this is the one that matters.
• Wholesale Price Index (WPI) prices between businesses — Tracks prices when goods are sold in bulk between businesses. Easier to compute, but it misses what consumers actually pay.
• When it's released monthly — The Ministry of Statistics (**MoSPI**) publishes CPI inflation around the **12th** of each month.

**Remember:** high inflation is a bad signal for markets, partly because it can lead to higher interest rates.

The RBI aims to keep CPI inflation around 4%, within a band of 2% to 6%.

Read the inflation print

Slide the print.

These are tendencies. The RBI also weighs growth, and markets compare each print with what they expected.

Same onion, two prices

Onions go from ₹15 to ₹20 a kilo in your local shop, while bulk prices barely move.

• CPI picks it up retail — Your shopping basket cost more. CPI inflation rises.
• WPI may not wholesale — Bulk prices between businesses didn't change much, so WPI barely moves.

**Remember:** CPI is the inflation you feel. It's the one markets and the RBI watch most.

Check — Question 3 of 4

CPI or WPI?

What you now know

• Inflation is the rate at which prices rise over time.
• CPI tracks retail prices that consumers pay; WPI tracks wholesale prices between businesses.
• MoSPI publishes CPI inflation every month, around the 12th.
• High inflation is a bad signal for markets and can lead to higher interest rates.
• Cooling inflation can give the RBI room to cut rates.