India’s wholesale price inflation decreased to 0.13% in September, down from 0.52% in August, as food prices continued to decline, according to data released by the government on Tuesday. The Wholesale Price Index (WPI) inflation in September of the previous year was recorded at 1.91%.Retail inflation dropped to its lowest level in eight years at 1.54% in September, based on data released on Monday. The continued decrease in WPI inflation enhances the likelihood of retail prices remaining stable in the upcoming months, particularly following the reduction in Goods and Services Tax (GST).
Year-on-year, food prices in the wholesale sector have entered a deflationary phase once again, and the growth rate for primary articles and fuel also stayed in the negative range. Compared to the same month last year, the food index fell by -1.99% in September, a decline from 0.21% growth in August.
Inflation for primary articles was -3.32% in September, contrasting with 2.10% in August. Fuel power inflation for the month stood at -2.58%, compared to -3.17% the month before.
The inflation rate sank well below the Reserve Bank of India’s (RBI) lower tolerance threshold of 2%, heightening the prospects of an interest rate reduction in December. The retail inflation rate for September represents the lowest figure since June 2017, which recorded 1.46%, making the current number a 99-month low. In August 2025, the inflation rate was 2.07%.
Among manufacturing products in WPI, there were month-on-month price increases observed in food products, electrical equipment, textiles, and various non-metallic mineral products. Conversely, some categories that experienced price declines included rubber and plastics products, motor vehicles, trailers, semi-trailers, and pharmaceutical, medicinal chemical, and botanical products.
However, core WPI inflation rose to 1.8% in September 2025, compared to zero in the same month last year, noted Economist Sonal Badhan from Bank of Baroda. For the period between April and September, WPI inflation averaged 0.14%, a decrease from 2.10% during the corresponding period of the previous financial year.
Furthermore, the streamlining of GST rates is anticipated to positively affect the overall inflation landscape. For FY26, CareEdge Ratings forecasts the average WPI inflation to be around 0.1%.
