Food Price Indices: In the context of inflation measurement, food price indices play a crucial role. Both the Wholesale Price Index (WPI) and the Consumer Price Index (CPI) have specific indices dedicated to food prices. These indices track the changes in the prices of food items over time, providing insights into the inflationary pressures within the food sector.
- WPI Food Index: This index, part of the Wholesale Price Index, focuses on tracking changes in the prices of food items at the wholesale level, providing insights into inflation trends in the food supply chain.
- CPI Food Price Index: Within the Consumer Price Index, the food price index reflects changes in the retail prices of food items. It is a key component of the overall CPI, contributing to the measurement of consumer inflation.
By monitoring food price indices, policymakers can assess the impact of inflation on essential goods, especially those related to basic sustenance, and make informed decisions to maintain economic stability.
Consumer Food Price Indices (CFPI): The Consumer Food Price Index (CFPI) is released by the Central Statistics Office (CSO) and is a part of the new Consumer Price Index (CPI) series in India. It covers food products consumed by specific population groups in rural, urban, and combined areas. The CFPI provides insights into the changes in prices of food items over time, contributing to the assessment of inflation in the food sector. The base year for CFPI is 2012.
FAO Food Price Index: The Food and Agriculture Organization (FAO) of the United Nations releases the FAO Food Price Index, which is a measure of the monthly changes in international prices of a basket of food commodities. This global index comprises five commodity group price indices (Cereal, Vegetable Oil, Dairy, Meat, and Sugar), weighted based on the average export shares of each group for the base year 2002-2004 (with a value of 100). The FAO Food Price Index is a key indicator for monitoring trends in global food prices.
