Chaos: A tale of 4 inflation rates

Source: DNA Money

These are inflationary times. Daily encounters at the market place confirm this, contradicting the official line that the price situation has taken a benign turn.

True, the wholesale price index or WPI-based inflation rates for June and July are negative, having declined by 1.14% and 1.38% compared with their respective year-ago levels.

But at the retail level, the story is diametrically opposite. The inflation rate, using the consumer price index for industrial workers, has accelerated to 9.29% in June from 8.63% in the preceding month and has soared past the double-digit mark to stand at 11.89% in July.

In rural India, the price fever is raging even more fiercely, with the consumer index for agricultural labourers up by 11.52% in June and further to 12.90% in July; the same upward movement is seen in the similar index for rural labourers.

Thus, out of the four inflation rates, three have scaled a new high in recent period, even as the one, linked to the WPI, pursues a downward path during the same period.
There is another index for the so-called executives and management personnel of the organised workforce — the consumer price index for urban non-manual employees.

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