Wholesale Inflation Inches Up to 0.83% in December 2025

India’s wholesale inflation showed a mild increase in December 2025 after two months of deflation. Official data indicates that prices of food items, manufactured products and non-food articles pushed inflation into positive territory. The trend comes amid low retail inflation and an accommodative monetary policy stance by the central bank.

Why in News?

Wholesale Price Index (WPI) inflation rose to 0.83% in December 2025. It returned to positive territory after deflation in October and November.

Trend in Wholesale Inflation

• The wholesale inflation trend indicates a gradual recovery from deflationary pressures.
• In October 2025, WPI inflation stood at -1.21%, followed by -0.32% in November. December’s positive reading of 0.83% suggests improving demand conditions and stabilisation in input prices.
• However, inflation remains much lower compared to December 2024, when WPI inflation was 2.57%.
• This trend reflects overall price moderation in the economy, supported by softer global commodity prices and controlled domestic demand, while still showing signs of recovery in industrial activity.

Key Factors Driving the Increase

• The rise in wholesale inflation was mainly due to higher prices in manufactured products, minerals, and machinery and equipment.
• Manufactured products recorded 1.82% inflation, up from 1.33% in November, indicating increased production costs.
• Non-food articles also saw inflation rise to 2.95%, reflecting higher prices of raw materials like oilseeds and fibres.
• Although food articles remained in deflation, the extent reduced sharply, contributing indirectly to the upward movement in overall WPI inflation.

Food and Fuel Price Movement

• Food articles continued to show deflation at 0.43% in December, but this was an improvement from 4.16% deflation in November.
• Vegetable prices, in particular, saw deflation narrow significantly to 3.50%, compared to a steep 20.23% earlier.
• On the other hand, the fuel and power category remained in deflation at –2.31%, mainly due to lower global energy prices.
• These trends indicate easing supply-side pressures but limited pass-through to wholesale prices from fuel costs.

Retail Inflation and RBI’s Policy Context

• Retail inflation, which is tracked through the Consumer Price Index (CPI), rose to 1.33% in December, from 0.71% in November, mainly due to rising food prices.
• The Reserve Bank of India focuses on retail inflation while setting interest rates. In FY26, the RBI has reduced policy rates by 1.25 percentage points and cut the repo rate to 5.25%, calling the current phase a “Goldilocks period” of high growth and low inflation.

What is WPI Inflation?

• The Wholesale Price Index measures price changes at the wholesale level, reflecting inflation faced by producers rather than consumers.
• It includes primary articles, fuel and power, and manufactured products.
• WPI is important for understanding cost pressures in industry, but it does not directly influence monetary policy decisions, unlike retail inflation.

Key Summary at a Glance

Aspect	Details
Why in News?	WPI inflation turns positive
WPI Inflation (Dec 2025)	0.83%
Previous Month	-0.32% (Nov 2025)
Key Drivers	Food, manufactured goods
Fuel & Power	Remained in deflation
Retail Inflation	1.33% in December

Question

Q. Wholesale Price Index (WPI) inflation measures price changes at which level?

A) Retail level
B) Consumer level
C) Wholesale level
D) International level