WPI INFLATION

Current Context: India’s Wholesale Price Index (WPI)-based inflation stood at –0.58% in July 2025, marking the second consecutive month of deflation, mainly due to falling prices of food, fuel, and metals.

ABOUT WPI INFLATION (JULY 2025)

• Released By: Ministry of Commerce and Industry
• Rate: –0.58% (Year-on-Year basis)
• Trend: Deflation for the second month in a row
• Reason: Cooling input prices across food, energy, and metals

KEY DRIVERS OF WHOLESALE DEFLATION

1. Food Prices Decline
   • WPI Food Index: –2.15%
   • Reduced prices of vegetables, cereals, edible oils, pulses, onions, tomatoes
2. Primary Articles Weakness
   • Inflation: –4.95%
   • Lower agricultural output, minerals, forest produce
3. Fuel and Power Segment in Deflation
   • Inflation: –2.43%
   • Impact of stable international oil prices and moderate domestic demand
4. Manufactured Goods Show Mild Inflation
   • Inflation: 2.05%
   • Input cost recovery in some sectors, stable demand in consumer durables and capital goods

WPI vs CPI (JULY 2025)

• WPI: –0.58%
• CPI:55% (lowest in 8 years)
• Significance: Indicates widespread price moderation across wholesale and retail levels, potentially shaping monetary policy.