Wholesale Inflation India: Wholesale inflation declined to a 27-month low of minus 1.21 percent in October due to decline in prices of food articles like pulses and vegetables as well as softening of prices of fuel and manufactured goods.
Inflation based on Wholesale Price Index (WPI) was 0.13 percent in September and 2.75 percent in October 2024. The Industry Ministry said in the statement, “The main reason for the decline in inflation in October 2025 was the softening of prices of food items, crude petroleum and natural gas, electricity, mineral oils and manufacturing of base metals etc.”
Know what the statistics say?
According to the Wholesale Price Index data, the inflation rate of food items decreased by 8.31 percent in October as compared to 5.22 percent in September. A decline was seen in the prices of onion, potato, vegetables and pulses. The inflation rate of vegetables declined by 34.97 percent in October whereas it was 24.41 percent in September. A decline of 16.50 percent was recorded in pulses in October, while in potatoes and onions it was 39.88 percent and 65.43 percent respectively.
In case of manufactured products, inflation declined to 1.54 percent from 2.33 percent in September. Fuel and electricity prices declined by 2.55 percent in October, whereas in the previous month they had declined by 2.58 percent. Paras Jasrai, Executive Director, India Ratings and Research, said, “The decline in wholesale inflation is expected to continue from a favorable comparative base in the remaining period of the financial year 2025-26.”
Benefits of GST reform
In such a situation, India Ratings estimates that the decline in wholesale inflation will be less than one percent in November 2025. After the cut in Goods and Services Tax (GST) rates effective from September 22, the wholesale price index (WPI) based inflation has declined as expected. As part of the rationalization of tax rates, GST rates on items of daily use were reduced, under which the four-tier tax structure was reduced to two categories of five and 18 percent.
The tax cut brought down commodity prices and both wholesale and retail inflation declined due to last year’s favorable inflation base. Retail inflation stood at an all-time low of 0.25 per cent in October due to the cut in GST rates and last year’s high base. Inflation based on retail or consumer price index was 1.44 percent in September.
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