Daijiworld Media Network - New Delhi

New Delhi, Sept 15: India’s wholesale inflation rose to 0.52% in August, driven by rising prices of food products and manufactured goods, according to the latest data released by the Ministry of Commerce and Industry. The increase marks a reversal from July’s deflationary trend, when the Wholesale Price Index (WPI) stood at -0.58% — a two-year low.

In a press release, the government noted that the positive WPI inflation in August 2025 was mainly due to higher prices of food items, non-food articles, manufactured goods, non-metallic mineral products, and transport equipment.

However, fuel prices continued to decline, easing some inflationary pressure. The WPI-based fuel inflation for August was reported at -3.17%, reflecting ongoing decreases in prices of petrol, diesel, and natural gas.

Retail Inflation Remains Mild at 2.07%

While wholesale prices rose slightly, retail inflation (based on the Consumer Price Index, or CPI) remained well within the Reserve Bank of India’s (RBI) target, clocking in at 2.07% for August, up from 1.61% in July — the lowest since June 2017.

Despite the marginal rise in headline inflation, food prices continued to decline, offering relief to consumers. Food inflation was recorded at -0.69%, staying in negative territory for the third consecutive month.

Key drivers of falling food inflation included:

• Vegetables: ↓ 15.92%
• Pulses: ↓ 14.53%
• Spices: ↓ 3.24%

That said, meat and fish, eggs, edible oils, and personal care items saw price increases, which slightly nudged headline CPI upward.

RBI Maintains Optimism on Inflation Outlook

With inflation levels still comfortably below the 4% medium-term target, the RBI is expected to maintain its accommodative monetary stance to support economic growth.

In its latest assessment, the RBI projected CPI inflation at 3.1% for 2025–26, citing strong agricultural indicators:

“The inflation outlook for 2025-26 has become more benign than expected in June,” said RBI Governor Sanjay Malhotra.

“Large favourable base effects combined with steady progress of the southwest monsoon, healthy kharif sowing, adequate reservoir levels, and comfortable buffer stocks of foodgrains have contributed to this moderation.”

Outlook

• WPI Inflation: Slightly up but still low — no major concern yet.
• CPI Inflation: Rising marginally but remains within RBI comfort zone.
• Fuel Prices: Continued decline may help moderate inflation further.
• Food Prices: Mixed trends — overall decline, but specific categories like meat and eggs showing upward movement.

With inflation under control and food supply indicators stable, the central bank is expected to maintain its soft monetary policy in the near term, keeping interest rates supportive of growth.