- WPI inflation eased to 9.78% in July.
- Lower fuel, power, and food costs drove the WPI drop
- Retail inflation rose due to high food prices.
Wholesale price inflation eased marginally to 9.78 per cent in July, as against 9.87 per cent in June. This marks the first month-on-month drop in WPI-based inflation since the introduction of the 2022-23 base year. Retail inflation rose due to high food prices during the month.
Key Factors That Brought WPI Inflation Down
Lower costs for fuel, power, and food drove this decline. Previously, the WPI had climbed throughout the fiscal year as regional conflicts in West Asia and supply chain disruptions in the Strait of Hormuz inflated global crude and fertiliser prices, subsequently impacting food costs.
"Across groups, mineral oils (containing petroleum products), food articles, manufacture of basic metals, non-food articles, manufacture of food products, and manufacture of chemicals and chemical products have been major drivers of WPI inflation in July 2026," the commerce and industry ministry said while releasing the monthly Wholesale Price Index (WPI) data on Friday.
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Fuel and Power: Wholesale inflation fell to 20.05 per cent in July from 27.41 per cent in June. Food article inflation also decreased slightly to 5.44 per cent from 5.49 per cent over the same period.
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Conversely, manufactured products inflation rose to 8.29 per cent in July, up from 7.48 per cent in June.
Retail Inflation
Recent data indicates India's retail inflation climbed to 4.45 per cent in July from 4.38 per cent in June, driven by high food costs.
Monetary Policy: The RBI maintained benchmark rates at 5.25 per cent this month. It projects FY27 retail inflation at 5 per cent, noting risks from an uneven monsoon and El Niño conditions.
(With Inputs From PTI)