I just did a note on Indian CPI inflation. This note is a follow-up of the CPI note with the intent to deep dive into the WPI inflation to see what story it tells. This is important as the WPI has a direct bearing on the CPI inflation if allowed to persist uncontrolled for a long time. As in the earlier note, the story will be told through charts. These charts are not static, they are dynamic. As it enables the readers to drill down to get further insights into not only the inflationary trends but also the ability to see the picture from different angles based on chosen metrics from the dropdown menus.
WPI — Main Category
Here is the screenshot of the trend of the last 10 months of the WPI main category of items. The items are sorted by their weights — i.e the contribution to the overall inflation.
Key takeaways:- Five items with higher weights — Mineral Oils, Milk, Electricity, Cereals, and Manufactured Grains contribute to more than 20% of the overall WPI index. The concern is that the inflation in these items is still high and needs to be controlled if the overall index has to be contained down further.
The interested reader can deep dive into these items by visiting my page — https://paragkar.com/indian-wpi-inflation-trends/
WPI — Sub Category
Here is the screenshot of the trend of the last 10 months of the WPI Subcategory of items. The items are sorted by their weights — i.e the contribution to the overall inflation.
Key takeaways:- Top 10 items’ contribution to the overall index is more than 20%. All items in this list are a matter of concern except motorcycles, sugar, and paddy.
The interested reader can deep dive into these items by visiting my page — https://paragkar.com/indian-wpi-inflation-trends/
WPI — Heat Map
The following is the heat map for inflation of the various items since 2014. This is sorted in decreasing order by weight. This gives a birds-eye view and gives deep insights as to how these items have behaved over various time frames as regards inflation.
Key takeaways:- Looking at this map one can clearly see the items which are responsible for driving the WPI inflation high. Some of these items have cooled down but more needs to be done to drive those which are still high in order to bring the overall inflation down.
Hope you find this analysis useful.
PS: Find the list of other relevant articles in the embedded link.
