india-s-wholesale-inflation-in-fy26-may-rise-further-say-experts

A rise in the prices of food and manufactured goods, wholesale inflation based on the Wholesale Price Index (WPI) turned positive at 0.52 per cent in August, as per government data released on Monday. 

This is in line with the retail inflation based on Consumer Price Index (CPI), which rose to 2.07 per cent in August after a gap of nine months.

“Positive rate of inflation in August, 2025, is primarily due to increase in prices of food products, other manufacturing, non-food articles, other non-metallic mineral products and other transport equipment etc.,” said the Ministry of Commerce and Industry in a statement. 

In July, 2025, WPI-based inflation was -0.58 per cent, while it was -0.19 per cent in June. It was 1.25 per cent in August, 2024. 

 

Also Read: WPI inflation in July turns negative

The WPI data released by the government on Monday also showed lower deflation in food prices in August at 3.06 per cent as vegetable prices surged. In July, it was 6.29 per cent. Deflation in vegetables alone was 14.18 per cent in August, as against 28.96 per cent in July. 

In the case of manufactured products, however, inflation was higher at 2.55 per cent in August, as against 2.05 per cent in the month before. Fuel and power also saw a negative inflation or deflation of 3.17 per cent in August, as against 2.43 per cent in July.

Analysts see a further increase in the WPI as global crude oil and commodity prices see an uptick and the rupee continues to depreciate. 

“ICRA expects the headline WPI to rise further to a 6-month high of 0.9 per cent in September 2025, led by a hardening in the YoY prints for global crude oil and commodity prices, as well as the depreciation in the USD/INR pair, even as an elevated base would likely pull down the food index back to the deflationary territory in the month,” said Rahul Agarwal, senior economist at ICRA Ltd. 

Meanwhile, the Reserve Bank of India is likely to hold interest rates steady in October during its review meeting because of a stronger-than-expected GDP growth in Q1 and the positive impact of GST rationalisation on growth outcomes in H2 FY2026.