On 14 August 2026, the Office of the Economic Adviser, DPIIT, in the Ministry of Commerce & Industry, released the provisional estimates of the Wholesale Price Index, the Output Producer Price Index (OPPI) and the trial Input Producer Price Index (IPPI) for July 2026, on the new base year of 2022-23.
Two things make this worth close attention. The headline number — WPI inflation of 9.78% — sits startlingly far above the CPI inflation of 4.45% reported for the same month. And behind the release is a structural reform of Indian price statistics: the WPI is on its way out, to be replaced by a Producer Price Index, in line with the practice of advanced economies and the recommendations of the IMF.
The July 2026 numbers
| Indicator | July 2026 | June 2026 |
|---|---|---|
| WPI inflation (YoY) | 9.78% | 9.87% |
| All Commodities index | 110.0 | 110.2 |
| Primary Articles — inflation | 8.52% | 7.00% |
| Fuel and Power — inflation | 20.05% | 27.41% |
| Manufactured Products — inflation | 8.29% | 7.48% |
| WPI Food Index — inflation | 6.65% | 6.14% |
Group indices for July 2026: Primary Articles 117.2, Fuel and Power 105.4, Manufactured Products 108.4.
The major drivers of WPI inflation in July were mineral oils (petroleum products), food articles, manufacture of basic metals, non-food articles, manufacture of food products, and manufacture of chemicals and chemical products.
The WPI Food Index deserves a note because its construction is examinable: it is not a single group, but a composite of "Food Articles" from Primary Articles and "Manufacture of Food Products" from Manufactured Products. Their weights are 15.98 and 9.02 respectively, which sum to the stated 24.99% — a neat check that the index does what it says.
Provisional versus final estimates. The final index for May 2026 was revised upward from 109.9 to 110.1, and May's inflation from 9.68% to 9.88%. The reason is the response rate: the May final estimate was compiled with a weighted response rate of 98.14%, whereas the July provisional estimate rests on 78.55%. Provisional numbers are published early with incomplete returns and revised as more arrive — which is why a headline figure should always be read as provisional until finalised.
The structure of the WPI
The weighting scheme explains almost everything about how the index behaves:
| Major group | Weight |
|---|---|
| Manufactured Products | 63.13% |
| Primary Articles | 22.76% |
| Fuel and Power | 14.11% |
Within Primary Articles: Food Articles 15.98, Non-Food Articles 5.53, Minerals 1.25. Within Fuel and Power: Mineral Oils 8.19, Electricity 4.46, Coal and Lignite 0.74, Crude Petroleum and Natural Gas 0.72.
Notice that manufactured goods dominate the WPI at nearly two-thirds of the basket, whereas a consumer price index is dominated by food, housing and services. That difference in composition is the key to the puzzle of the two headline numbers.
Why WPI (9.78%) is so far above CPI (4.45%)
This is the single best analytical question available on the topic, and a good answer has four parts:
1. The baskets are entirely different. The CPI measures what a household buys — food, housing, health, education, transport, and above all services. The WPI covers goods only and excludes services altogether. Since services are a large and relatively stable share of consumer spending, excluding them removes a moderating influence from the WPI.
2. The WPI is far more exposed to commodities. Fuel and Power inflation was 20.05% in July, and mineral oils and basic metals were named among the main drivers. Global commodity and energy prices pass into the WPI quickly and at full force. In the CPI, the same shock is diluted by retail margins, administered prices and the large weight of items whose prices move slowly.
3. Stage of the chain. WPI prices are recorded near the point of production and bulk transaction; CPI prices are recorded at retail. Costs at the wholesale stage are absorbed, smoothed or passed on with a lag by distributors and retailers, so a wholesale spike shows up at retail later and smaller — if at all.
4. Therefore a large gap is structural, not contradictory. The two indices are measuring different things at different points in the economy. What a wide and persistent WPI-over-CPI gap does signal is margin compression for producers and distributors, and the possibility of future pass-through to retail if input costs stay elevated. That is precisely why policymakers watch the wedge between them rather than either alone. These relationships are developed in the notes on inflation.
The base effect — a second essential idea
Look closely at Fuel and Power. Its index fell from 111.1 in June to 105.4 in July, and the mineral-oils index fell from 122.9 to 113.2. Yet its year-on-year inflation was still 20.05%.
How can prices fall month-on-month while inflation stays at 20%? Because inflation is a comparison with the same month one year earlier. If prices a year ago were very low, then even after a recent decline the current level can remain far above that base. This is the base effect, and it works both ways: a high base a year ago can make current inflation look low even while prices rise.
The practical lesson — and a strong point to make in an interview — is that the inflation rate and the price level are not the same thing. Falling inflation does not mean falling prices; it means prices are rising more slowly. Only deflation means the price level itself is falling.
The big reform: from WPI to PPI
This is the genuinely new material in this release, and it is likely to be examined for years.
What has changed:
- The base year of the WPI has been revised from 2011-12 to 2022-23, the revision having been approved in May 2026.
- Alongside the revised WPI, the Office of the Economic Adviser now publishes an Output Producer Price Index (OPPI), a trial Input Producer Price Index (IPPI), and a Service PPI covering seven services — banking, securities transactions, insurance, management of pension funds, railways, air (passenger) and telecom — all on the same base year.
- The WPI is to be released for five years alongside the PPI and then discontinued.
- The transition is stated to be in line with global best practice in advanced economies and with IMF recommendations.
Why the WPI is being replaced. The WPI has three well-known conceptual defects:
- Multiple counting. The WPI records prices in wholesale transactions. The same physical good — steel, say — can be captured more than once as it passes through successive transactions, so the index double-counts and overstates the weight of intermediate goods.
- No services. Services are the largest part of India's GDP, and the WPI excludes them entirely. An index that ignores over half the economy cannot be a general measure of price change.
- Taxes and margins. WPI prices can embed indirect taxes and trade margins, which reflect fiscal and distribution decisions rather than underlying production costs.
What a PPI does instead. A Producer Price Index measures the average change in prices received by domestic producers for their output, recorded at the factory gate — excluding indirect taxes and trade margins. Because it measures output once, at the point of production, it avoids multiple counting; because it is defined by producer activity rather than by wholesale transactions, it can cover services; and because it strips out taxes, it isolates genuine price movement.
The complementary Input PPI measures the prices producers pay for their inputs. The gap between input and output PPI is a direct measure of margin pressure on producers — information no existing Indian index supplies, and of obvious value for the industry and services side of the economy.
The three indices, side by side
| CPI | WPI | PPI | |
|---|---|---|---|
| Measures | Retail prices paid by consumers | Prices in wholesale transactions | Prices received by producers at the factory gate |
| Coverage | Goods and services | Goods only | Goods and services |
| Taxes/margins | Included (as paid) | May be embedded | Excluded |
| Multiple counting | No | Yes | No |
| Released by | NSO, MoSPI | Office of the Economic Adviser, DPIIT | Office of the Economic Adviser, DPIIT |
| Base year | 2024=100 | 2022-23 | 2022-23 |
| Policy role | Monetary policy anchor | Input-cost and producer trends | Producer-side inflation, national accounts deflators |
For the current CPI numbers and the parallel base revision on the consumer side, see our explainer on the CPI for July 2026 on the new 2024=100 base.
A release-calendar detail worth knowing: the provisional WPI, Output PPI and trial Input PPI for a month are released on the 14th of the following month (or the next working day) — hence July's data on 14 August, and August's due on 14 September 2026.
The revision hook: On 14 August 2026 the Office of the Economic Adviser, DPIIT, released WPI, Output PPI and trial Input PPI for July 2026 on the new base year 2022-23 — WPI inflation 9.78% against 9.87% in June, all-commodities index 110.0, Primary Articles 8.52%, Fuel and Power 20.05%, Manufactured Products 8.29%, and the WPI Food Index 6.65% on a weight of 24.99% formed from Food Articles (15.98) and Manufacture of Food Products (9.02); major group weights are Manufactured Products 63.13%, Primary Articles 22.76% and Fuel and Power 14.11%; the May 2026 final index was revised up from 109.9 to 110.1 and inflation from 9.68% to 9.88%, with weighted response rates of 98.14% for the final and 78.55% for the provisional estimate; the WPI base has moved from 2011-12 to 2022-23 and the WPI will run for five years alongside a Producer Price Index before being discontinued, with a Service PPI covering banking, securities transactions, insurance, pension fund management, railways, air passenger and telecom, in line with IMF recommendations; the WPI suffers from multiple counting, exclusion of services and embedded taxes and margins, while a PPI measures factory-gate prices received by producers excluding indirect taxes and trade margins; WPI is released by DPIIT and CPI by NSO under MoSPI, and provisional indices appear on the 14th of the following month.
Why it matters
- Statistics decide policy. An index that double-counts intermediate goods and ignores services will misdescribe an economy where services dominate. Replacing it is not a technical footnote; it changes what policymakers see.
- The input-output gap is new information. Publishing both an Input and an Output PPI reveals whether producers are absorbing cost increases or passing them on — a leading indicator of both retail inflation and corporate profitability.
- International comparability. Moving to PPI on IMF-recommended lines makes Indian data comparable with that of advanced economies, which matters for investors, for national accounts deflators and for India's standing in global statistics.
- The honest caveat. The trial Input PPI is exactly that — a trial — and a five-year parallel run exists precisely because a new series needs testing against the old one. And a new base means the current numbers are not directly comparable with pre-revision figures. Anyone comparing today's 9.78% with a 2011-12-base figure from earlier years is comparing two different baskets.
Exam relevance in one paragraph
For CDS/OTA General Knowledge, retain: on 14 August 2026 the Office of the Economic Adviser in the Department for Promotion of Industry and Internal Trade released provisional estimates of the Wholesale Price Index, the Output Producer Price Index and the trial Input Producer Price Index for July 2026 on the revised base year of 2022-23, reporting year-on-year wholesale inflation of nine point seven eight per cent against nine point eight seven per cent in June, with the all-commodities index at one hundred and ten, inflation of eight point five two per cent in Primary Articles, twenty point zero five per cent in Fuel and Power and eight point two nine per cent in Manufactured Products, and a WPI Food Index inflation of six point six five per cent computed on a weight of twenty-four point nine nine per cent formed by combining Food Articles from Primary Articles with Manufacture of Food Products from Manufactured Products; the major group weights are Manufactured Products at sixty-three point one three per cent, Primary Articles at twenty-two point seven six per cent and Fuel and Power at fourteen point one one per cent, and the final index for May 2026 was revised upward from one hundred and nine point nine to one hundred and ten point one with inflation revised from nine point six eight to nine point eight eight per cent, the final estimate resting on a weighted response rate of ninety-eight point one four per cent against seventy-eight point five five per cent for the provisional; the wide gap between wholesale inflation of nine point seven eight per cent and consumer inflation of four point four five per cent for the same month arises because the Wholesale Price Index excludes services, is dominated by manufactured goods and commodities and is recorded near the point of production, whereas the Consumer Price Index measures retail prices including services; the fact that the Fuel and Power index fell month-on-month while its year-on-year inflation remained at twenty per cent illustrates the base effect, since inflation compares the current month with the same month a year earlier; and structurally the Wholesale Price Index is being replaced by a Producer Price Index measuring prices received by producers at the factory gate excluding indirect taxes and trade margins, thereby avoiding the multiple counting inherent in wholesale transactions and permitting coverage of services, with an Output Producer Price Index, a trial Input Producer Price Index and a Service Producer Price Index for banking, securities transactions, insurance, pension fund management, railways, air passenger transport and telecom, the Wholesale Price Index being scheduled to run for five years alongside it before discontinuation, in alignment with the practice of advanced economies and the recommendations of the International Monetary Fund.
🎯 Practice MCQs
Q1. WPI inflation for July 2026 was: (a) 9.78% (b) 4.45% (c) 6.65% (d) 20.05% → (a) — 4.45% was CPI inflation for the same month.
Q2. The revised base year of the WPI is: (a) 2022-23 (b) 2011-12 (c) 2024 (d) 2004-05 → (a).
Q3. The WPI is released by the: (a) Office of the Economic Adviser, DPIIT (b) NSO, MoSPI (c) RBI (d) NITI Aayog → (a) — the CPI comes from NSO/MoSPI.
Q4. The largest major group by weight in the WPI is: (a) Manufactured Products (b) Primary Articles (c) Fuel and Power (d) Services → (a) — about 63%.
Q5. Which group recorded the highest inflation in July 2026? (a) Fuel and Power (b) Primary Articles (c) Manufactured Products (d) Food Index → (a) — 20.05%.
Q6. A Producer Price Index measures prices: (a) received by producers at the factory gate (b) paid by consumers at retail (c) of imports only (d) of exports only → (a) — excluding indirect taxes and trade margins.
Q7. A key defect of the WPI that the PPI avoids is: (a) multiple counting (b) inclusion of services (c) monthly release (d) use of a base year → (a).
Q8. Unlike the WPI, a PPI can cover: (a) services (b) only agriculture (c) only imports (d) only fuel → (a).
Q9. The transition from WPI to PPI is stated to follow the recommendations of the: (a) IMF (b) WTO (c) World Bank (d) ADB → (a).
Q10. The WPI Food Index is constructed from: (a) Food Articles plus Manufacture of Food Products (b) Food Articles alone (c) Manufacture of Food Products alone (d) Primary Articles as a whole → (a) — weights 15.98 + 9.02 = 24.99.
Q11. The May 2026 final WPI was revised upward chiefly because of: (a) a higher response rate in the final estimate (b) a change in base year (c) a rise in tax rates (d) a currency revaluation → (a) — 98.14% against 78.55%.
Q12. Prices falling month-on-month while year-on-year inflation stays high is explained by the: (a) base effect (b) substitution effect (c) income effect (d) multiplier effect → (a).
Q13. A fall in the rate of inflation while the price level still rises is called: (a) disinflation (b) deflation (c) stagflation (d) hyperinflation → (a).
Q14. Provisional WPI and PPI figures for a month are released on the: (a) 14th of the following month (b) last day of the month (c) 1st of the following month (d) 30th of the following month → (a) — or the next working day.
Q15. The Service PPI initially covers how many services? (a) Seven (b) Three (c) Twelve (d) Twenty → (a) — banking, securities transactions, insurance, pension fund management, railways, air (passenger) and telecom.
📋 How this gets asked (PYQ pattern)
Price indices are a dependable CDS/OTA economy set, and this release adds a genuinely new angle. The agency item — WPI and PPI with the Office of the Economic Adviser under DPIIT, CPI with NSO under MoSPI; swapping them is the most common error. The coverage item — that the WPI excludes services while CPI and PPI include them, usually as a statement pair. The base-year item — CPI at 2024=100 and WPI/PPI at 2022-23, both newly revised, which makes them prime one-liner material this cycle. The concept item — multiple counting, the base effect, and disinflation versus deflation. The fresh 2026 hook is the shift from WPI to PPI on IMF lines, the five-year parallel run, and the 9.78% versus 4.45% divergence. We reference the pattern, not any exact past question.
Preparing for CDS or OTA? Being able to explain why wholesale and retail inflation diverge — rather than just quoting both — is exactly the depth that separates a strong interview answer from a rehearsed one. Follow our daily CDS/OTA current affairs and prepare with our faculty in the upcoming Cavalier courses in Delhi.
✍️ Written by Hitendra Deswal — Economy & current-affairs faculty at The Cavalier. Reviewed by the Cavalier Faculty Desk. The Cavalier, founded by ex-Army officers, has trained NDA/CDS/SSB aspirants since 2001 (Facebook · YouTube).
Source: PIB / Ministry of Commerce & Industry (Office of the Economic Adviser, DPIIT), 14 August 2026. Facts cross-verified with independent sources.