how a wholesale price index wpi works
wholesale price indexes are reported monthly to track the overall rate of change in producer and wholesale prices the index is set at 100 for its base period and calculated based on subsequent price changes for the aggregate output of goods 2to illustrate assume january 2021 is the base period if the aggregate price level rose 9 7 over the next year the wpi for january 2022 will be at 109 7 a wpi typically takes into account commodity prices but the products included vary from country to country they are also subject to change as needed to better reflect the current economy some small countries only compare the prices of 100 to 200 products while larger ones tend to include thousands of products in their wpis 3the wholesale price index vs the producer price indexin the u s wholesale price index reporting dates back to 1902 in 1978 the bls renamed the wpi the producer price index ppi in part because the index never measured price change in the wholesale market focusing consistently on the prices charged by producers 1at that time the bls shifted to a methodology dividing goods based on their stage of production that focus which minimizes double counting persists in the current ppi methodology aggregating prices into final demand and intermediate demand indexes depending on whether the price is that of a finished product or an intermediate good 4