Weekly wholesale price index-based inflation numbers are now history. The government discontinued the release of such data from on Thursday, even as a Planning Commission official said it only on the insistence of the finance ministry and the Reserve Bank of India (RBI) that weekly numbers were brought out for so long.
Last month, the cabinet committee on economic affairs (CCEA) had approved a proposal to release only monthly WPI data. This was aimed at curbing speculative movement in prices and giving a holistic inflation picture.
“Consequent upon the CCEA decision, the weekly release of WPI is discontinued with immediate effect,” a statement from the commerce & industry ministry said on Thursday.
Pronab Sen, principal advisor, Planning Commission, told Business Standard it was correct to scrap the weekly release of data, as the numbers led to speculation and were misleading. “People used to react to numbers which the data generators had no confidence in,” Sen said. “The finance ministry and RBI wanted the weekly numbers, as these had their analytical models tied to the weekly data. The finance ministry and RBI had argued strongly for holding up the numbers, as otherwise, they would have to alter the whole model,” said the former chief statistician.
Sen in the original cabinet note he had submitted in 2010, he had said weekly numbers should be scrapped.
Anis Chakravarty, director, Deloitte Haskins and Sells, said monthly numbers were better than weekly jumps and aberrations that had no meaning.
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Critics, however, say the government had discontinued the weekly release of inflation numbers to avoid answering questions on high inflation. They add there could not have been a better time to scrap the weekly numbers than during deflation.
Earlier, the government brought out only weekly WPI inflation numbers, which included even manufactured products. From October 2010, it decided to shift to weekly inflation numbers, as well as monthly inflation data. While monthly data is comprehensive and gives headline inflation numbers, weekly numbers show inflation for only primary and energy articles.