WPI and CPI are two commonly used measures that are effective in determining the inflation in an economy. WPI stands for Wholesale Price Index, which measures the average change in price in the sale of goods or services in bulk quantity by the wholesaler. CPI stands for Consumer Price Index, which measures the change in the price in the sale of goods or services in retail or directly to a consumer. Here are some key differences between WPI and CPI:

• WPI focuses on prices of goods traded between business houses, whereas CPI focuses on prices of goods purchased by consumers.
• WPI measures the average change in price in the sale of goods or services in bulk quantity by the wholesaler, whereas CPI measures the change in the price in the sale of goods or services in retail or directly to a consumer.
• WPI is for only goods, whereas CPI is for goods and services.

Both WPI and CPI are used to calculate the inflation rate. WPI is used to measure the average change in price in the sale of goods in bulk quantity by the wholesaler, and CPI is used to measure the change in the price in the sale of goods or services in retail or directly to a consumer. The government assigns different weights to different goods and services based on what is relevant for those two types of consumers. The Reserve Bank of India uses CPI data to control inflation.