- TheLabour Bureau, an attached office of the M/o Labour & Employment, has been compiling Consumer Price Index for Industrial Workers every month on the basis of the retail prices of selected items collected from 289 markets spread over 78 industrially important centres in the country.
- The index is compiled for 78 centres and All-India and is released on the last working day of succeeding month.
Consumer Price Index (CPI)
- Two Ministries – Ministry of Statistics and Programme Implementation (MOSPI) and Ministry of Labour and Employment (MOLE) are engaged in the construction of different CPIs for different groups/sectors.
- CPI inflation is also called as ‘retail inflation’ as the prices are quoted from retailers.
- CPI is based on retail prices and this index is used to calculate the Dearness Allowance (DA) for government employees.
Table: Different Price Indices in India
|WPI||Office of Economic Affairs, Ministry of Commerce and Industries||2011-12|
|CPI All India, CPI -Urban and Rural||CSO, Ministry of Statistics and Programme Implementation||2012|
|CPI-AL||Labour Bureau, Ministry of Labour and Employment||1986-87|
Does RBI use WPI or CPI Inflation to manage monetary policy?
- While earlier the Reserve Bank of India used WPI inflation to manage monetary policy expectations, it is now the CPI inflation which is largely taken into account.
Do you know?
- Headline inflation is the raw inflation figure reported through the Consumer Price Index (CPI).
- Core inflation removes the CPI components that can exhibit large amounts of volatility from month to month, which can cause unwanted distortion to the headline figure.
- The most commonly removed factors are those relating to the cost of food and energy.
- Inflation deliberately undertaken to relieve a depression- Reflation
- Rise in prices with little change in output- Stagflation. Stagflation is when economic growth is stagnant but there still is price inflation.
- Price rise at full employment- Continuous inflation
- The term ‘benign inflation’ implies a mild rate of inflation.
Office of the Economic Adviser (OEA)
- It is an attached office of the Ministry of Commerce & Industry.
The main statistical functions of the Office of Economic Adviser include, inter alia the following:
- Compiling and releasing monthly Wholesale Price Indices
- Compiling and releasing monthly Index of Core Industries Production
- Developing other Indices on an experimental basis, e.g. select business service price indices
- Supervising as a ‘source agency’
- Monthly Statistical compilation of macro indicators