In September 2026 India's wholesale prices rose 11.39% from a year earlier and its retail prices 5.54%. A gap of 5.85 percentage points between two official inflation numbers for the same month looks like one of them must be wrong. Neither is. They price different baskets, and this month the two diverge most in one place: fuel.
Both numbers came out in the same week. MoSPI published the consumer price index on 12 October and the Ministry of Commerce and Industry the wholesale price index on 14 October; the 14 October market report covered the wholesale release on the day.
Fuel is where the two indices part company
Put the two indices side by side, group against nearest group, and one row stands out.
| What is being priced | WPI, Sept 2026 | CPI, Sept 2026 |
|---|---|---|
| Headline | 11.39% | 5.54% |
| Fuel | Fuel and power: 25.85% | Housing, utilities and fuel: 2.74% |
| Food | Food articles: 8.14%; food index: 8.66% | Food (CFPI): 7.74%; food and beverages: 7.36% |
| Factory goods | Manufactured products: 9.76% | Clothing and footwear: 3.93% |
| Transport | (no services) | Transport: 5.01% |
| Services | not covered | Personal care and miscellaneous: 13.75%; restaurants and accommodation: 9.36%; education: 3.94%; health: 1.40% |
On the wholesale side, fuel and power rose 25.85%, up from 22.93% in August, and inside that group crude petroleum and natural gas were up 57.32% on a year earlier. On the retail side, the group that holds household fuel rose 2.74%.
Those are not the same item measured twice. WPI's fuel and power group is crude oil, natural gas, coal, refined products and electricity as they change hands in bulk: what a refinery, a power plant or a factory pays. CPI's group is "housing, water, electricity, gas and other fuels", so a household's rent sits in the same bucket as its gas cylinder and electricity bill. A jump in crude prices lands in full on the first and is diluted by rent in the second.
Two baskets, built for two different questions
The indices are built to answer different questions.
WPI asks what goods cost when they are first sold in bulk. It is published by the Office of the Economic Adviser in the Ministry of Commerce and Industry, and from June 2026 runs on a new base year, 2022-23, with 957 items against 697 in the old 2011-12 series. The new series moved crude petroleum and natural gas out of primary articles and into fuel and power. In the old series fuel and power carried a weight of 13.15% and manufactured products 64.23%. There are no services in WPI at all. September's WPI number is also provisional and will be revised once more price returns come in.
CPI asks what a household pays. MoSPI moved it to a 2024 base this year, with weights drawn from the 2023-24 household consumption survey. The new basket has 358 items, 308 goods and 50 services, priced in 1,465 rural and 1,395 urban markets. Food and beverages now carry 36.75% of the weight, down from 45.86% in the 2012 series, in line with the smaller share of spending on food that the survey recorded.
So a month in which oil and metals surge and household services stay calm tends to show WPI running ahead. A month in which vegetables spike and rents climb can show the reverse.
Food is where the two agree
Food is the one area where the two indices broadly line up. WPI food articles rose 8.14% and its wider food index 8.66%. CPI food inflation was 7.74%, up from 5.97% in August, and food and beverages as a group 7.36%.
The CPI detail shows how uneven that 7.74% was. Onion prices were up 108.09% from a year earlier, more than double August's 48.78%, ginger 62.85% and garlic 54.62%. Potatoes were 11.50% cheaper and tomatoes 8.62% cheaper. Rural inflation, where food takes a bigger share of spending, was 6.08% against 4.88% in cities.
Services appear only in CPI
The fastest-rising part of the consumer index this month was something WPI cannot see. Personal care and miscellaneous services rose 13.75%; that group includes jewellery, and silver jewellery alone was up 87.80% on a year earlier. Restaurants and accommodation rose 9.36%. At the other end, health rose 1.40% and education 3.94%.
The same split shows up inside goods. WPI's manufactured products rose 9.76%, driven by basic metals, chemicals and textiles, according to the ministry. Those are inputs. The finished goods a household buys moved much less: clothing and footwear were up 3.93% in CPI, and motor cars and jeeps were 4.51% cheaper than a year earlier.
A rough split of September's 5.54%
Here is a back-of-envelope split of the retail number using the published weight. Treat it as an approximation: an exact contribution uses each group's index level, not just its base-year weight, and I have only the weight.
- Food and beverages: weight 36.75%, inflation 7.36%. Weight × rate = 36.75% × 7.36% ≈ 2.7 percentage points of the headline.
- Everything else: 5.54 − 2.7 ≈ 2.8 points, from the remaining 63.25% of the basket.
- That works out to an average of roughly 4.5% inflation across everything that is not food.
So about half of September's retail inflation came from food, which is only about a third of the basket. On the wholesale side I can't do the same sum honestly: the group weights for the new 2022-23 series weren't in any source I could check, and the old series' weights no longer apply.
Which number the RBI watches
The RBI's inflation target is set on CPI, at 4% with a tolerance band of 2% to 6%. September's 5.54% was above the target and inside the band, and the RBI had already raised the repo rate by 25 basis points to 5.50% on 7 October, as the report from that day covered.
WPI still matters, in a different place. It is a fair proxy for what companies pay for fuel, metals and chemicals, which is why it comes up in results season when margins are discussed. A business whose costs track WPI and whose selling prices track CPI is squeezed when the two pull apart the way they did in September. Today's market report shows how closely margins are being read this quarter: Axis Bank fell 4.19% after its profit rose 38%, and Business Today put the fall down to a narrower net interest margin and higher operating costs.
When the October numbers come out next month, the comparison to make is the same one as in the table above: the fuel rows first, then food, then services. If the gap between the headlines changes, those three rows will show where the change came from.
Sources
- Wholesale price index, September 2026: Ministry of Commerce and Industry, as reported by Business Today, The Tribune and Free Press Journal
- Consumer price index, September 2026: MoSPI (press release), as reported by Business Today and Finnovate
- WPI series and old-series weights: Anantam IAS; CPI 2024 base, basket and food weight: Drishti IAS
- RBI repo rate decision of 7 October 2026: post-market report, 7 October
This guide explains public data for information only. It is not investment advice or a recommendation to buy or sell any security. I am not registered with SEBI as an investment adviser or research analyst.