India’s Wholesale Inflation Climbs to 9.87% in June as Food Prices Surge Despite Easing Fuel Inflation

The Wholesale Price Index (WPI) increased to 110.2 in June from 109.9 in May, as per figures released by the Ministry of Commerce and Industry. The rise indicates continued pressure on wholesale prices across key sectors of the economy.

Food inflation, measured through the WPI Food Index, climbed significantly to 6.14% in June from 4.49% in May. The increase in food prices emerged as one of the major factors behind the acceleration in overall wholesale inflation during the month.

Inflation in primary articles also recorded a rise, reaching 7.0% in June compared with 4.99% in May. Meanwhile, inflation in manufactured products remained unchanged at 7.48%, showing continued price pressure in the manufacturing sector.

Fuel and power inflation, although remaining at a high level, moderated to 27.41% in June from 30.33% in May. The government stated that mineral oils, food articles, basic metals, and chemicals and chemical products were among the major contributors to wholesale inflation during the month.

The sharp increase in WPI inflation comes amid global economic disruptions linked to the West Asia crisis and the effective blockade of the Strait of Hormuz, a key route through which a majority of India’s crude oil imports pass. The disruptions have also contributed to a spillover impact on food prices.

The government continues to calculate the Wholesale Price Index using 2022-23 as the base year. The latest data highlights the ongoing challenges posed by rising input costs and international supply disruptions affecting domestic price conditions.

Meanwhile, retail inflation also increased to a 17-month high of 4.38% in June, compared with 3.93% in the previous month. The Reserve Bank of India (RBI), which primarily considers Consumer Price Index (CPI) inflation while framing monetary policy, has been mandated by the government to maintain headline inflation at 4%, with a permissible range of 2% on either side.

The rise in wholesale and retail inflation reflects growing concerns over price stability, with food costs, global energy disruptions, and international supply chain pressures continuing to influence India’s inflation outlook.