Rising food prices may drive September wholesale inflation above 10%:How will this impact common man?

The wholesale inflation figures for September will be released today, 14 October. Experts say inflation would remained above 10% in September due to rising prices of food items. Wholesale inflation stood at 9.92% in August. A wholesale inflation rate of 10% means that goods available for ₹100 in the wholesale market last year would now cost approximately ₹110. Impact of wholesale inflation on the common man A prolonged period of high wholesale inflation adversely affects most productive sectors. If wholesale prices remain high for an extended period, producers pass the burden on to consumers. The government can control the Wholesale Price Index (WPI) only through taxes, as it did by cutting excise duty on fuel when crude oil prices rose sharply. However, the government can reduce taxes only to a limited extent. The WPI gives greater weight to factory-related goods such as metals, chemicals, plastics and rubber. Retail inflation reaches 5.54% Retail inflation rose to 5.54% in September, compared with 4.82% in August. Prices of vegetables such as potatoes, onions and tomatoes, as well as food items, increased. Crude oil also became more expensive because of tensions in the Middle East. For these reasons, inflation has risen for the 11th consecutive month. There are two types of inflation There are two types of inflation in India. One is retail inflation and the other is wholesale inflation. The retail inflation rate is based on the prices paid by ordinary consumers. It is also known as the Consumer Price Index (CPI). The Wholesale Price Index (WPI), on the other hand, refers to the prices charged by one business from another in the wholesale market.