India’s wholesale inflation edged down marginally in July but remained elevated at nearly 9.8%, underlining persistent cost pressures across key sectors amidst geopolitical tensions and rising input costs.
Wholesale inflation in India eased slightly in July, but remained at a punishingly high level as the rebound in factory-gate prices continued to ripple through the economy. The Wholesale Price Index rose 9.78% from a year earlier, down from 9.87% in June, according to the commerce and industry ministry. It was the first month-on-month decline in the government’s WPI series using the new 2022-23 base year.
The easing was broad but modest. Fuel and power inflation slowed sharply to 20.05% in July from 27.41% in June, while primary articles inflation increased to 8.52% from 7%. Manufactured products, a key gauge of producer cost pressure, rose 8.29%, compared with 7.48% in June. The food index, which combines food articles and food products, also edged higher to 6.65% from 6.14%.
Economists said the headline number still pointed to uncomfortable underlying pressure. Prachi Kele, lead economist at PL Capital, said wholesale inflation remained elevated at about 9.8% even after the slight monthly cooling, and noted that manufactured-product inflation accelerated, suggesting cost pressures are still building for producers. Rahul Agrawal, principal economist at ICRA, said core WPI excluding food and fuel rose to a series high of 8.2% in July from 7.5% in June, with firmer readings across 16 of 21 sub-sectors.
The July data follow a run-up in wholesale prices that began earlier in the fiscal year, as geopolitical tensions in West Asia lifted crude and fertiliser costs and fed into food and industrial inputs. In June, wholesale inflation had climbed to 9.87% from 9.68% in May, driven by mineral oils, food articles, basic metals and chemicals. Agrawal expects a sharper moderation in August, but said WPI inflation is likely to stay elevated for much of the year and could average about 8.5% in 2026-27.
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