WPI 11.39%, CPI 5.54%: Why Is There a Difference in Inflation?

India’s wholesale inflation jumped to 11.39% in September 2026 while retail inflation was at 5.54%, highlighting a widening gap between prices paid by businesses and the prices paid by consumers. Wholesale inflation shot up, driven higher by crude oil prices, manufacturing costs and food prices, although consumers have yet to feel the full impact.

But the disparity begs an important question: why are wholesale prices rising at more than twice the rate of retail prices?

Difference Between WPI and CPI

Wholesale Price Index (WPI) measures the change in the prices of goods at the wholesale or producer level, before they become available for consumption. It includes primary articles, fuel & power, and manufactured goods.

The Consumer Price Index (CPI), in contrast, measures the change in prices paid by households for goods and services, including food, housing, transport, education and healthcare.

They are made up in different ways.

WPI is goods-based, with industrial inputs such as metals, chemicals and petroleum products. CPI covers household expenditure on services not covered by WPI.

The indices are also calculated using different base years. WPI is on FY23 and the revised CPI series is on 2024.

Inflation September 2026: The Numbers

WPI inflation rose to 11.39% in September 2026 from 9.92% in August 2026, according to the Ministry of Commerce & Industry.

Retail inflation climbed to 5.54% from 4.83%, according to data released by the Ministry of Statistics & Programme Implementation.

September Inflation Comparison:

Wholesale inflation rose more than retail inflation in September. Both wholesale and retail inflation increased.

What’s Causing Wholesale Inflation to Rise Faster Than Retail Inflation?

Higher energy prices are one big reason.

Fuel & power inflation was 25.85% in September. Mineral oil prices increased by 40.02% YoY. Crude petroleum and natural gas inflation was 57.32%.

Higher global crude prices have raised input costs for fuel, transport and petrochemical-dependent companies.

Manufactured products also saw prices increase as inflation in metals, chemicals and other industrial materials rose to 9.76%.

But companies don’t pass all their cost increases on to consumers immediately.

Some companies absorb higher costs, resulting in lower margins, while others slowly increase selling prices. Existing inventories, supply contracts and competition may temper the pace of price increases.

Governments can influence how international energy prices are passed on to consumers through taxes and administered fuel prices.

What the Inflation Gap Means for Businesses and Consumers

If wholesale prices go up for a long stretch, that can pinch corporate profit margins, especially for companies that can’t pass the costs on to their customers.

Industries such as automotive, construction, consumer goods and manufacturing may see higher costs of raw materials and transportation.

Consumers may feel the impact through higher prices for packaged food, household products and services, but it may be slow.

The Reserve Bank of India uses CPI inflation as the main indicator for its monetary policy. So retail inflation at 5.54% in September is a significant number for future decisions on interest rates.

Outlook: Will Retail Inflation Catch Up?

Higher wholesale inflation may not lead to a similar increase in retail inflation.

The eventual outcome will depend upon input costs, the pricing policies of businesses, the level of domestic demand and government policies.

Wholesale inflation is in double digits and retail inflation is rising, so the next monthly readings will show whether these price pressures persist or start to ease.