Another inflation warning? Wholesale prices jump more than expected in June

India’s wholesale inflation gathered pace again in June, with price pressures firming across food and several key industrial categories. Official data released by the commerce and industry ministry on Tuesday showed wholesale inflation quickened to 9.87% in June from 9.68% in May, coming in above economists’ expectations of a 9.15% year-on-year rise.

The June print was also above a Reuters poll of economists, which had projected a 9.15% year-on-year increase. The ministry said the rise was driven primarily by higher prices of food articles, mineral oils containing petroleum products, manufacture of basic metals, and manufacture of chemicals and chemical products.

The WPI Food Index rose to 6.14% in June from 4.49% in May, reflecting a broad-based increase in food prices. Inflation in primary articles accelerated to 7% from 4.99% a month earlier. Within this category, prices of food articles increased 3.75% month on month, while non-food articles rose 1.43% and minerals climbed 0.58%. Crude petroleum and natural gas prices, however, declined 0.08% over the previous month.

Inflation in the fuel and power group eased to 27.41% in June from 30.33% in May. Every month, the index for the category declined 1.68%, led by lower prices of mineral oils, while electricity prices remained unchanged. Inflation in manufactured products, which account for nearly two-thirds of the WPI basket, remained unchanged at 7.48%.

Within manufactured products, prices of 22 out of 24 manufacturing groups increased every month. The biggest gains were recorded in manufacture of basic metals, chemicals and chemical products, food products, machinery and equipment, and other manufacturing.

Prices of pharmaceuticals, medicinal chemical and botanical products, and fabricated metal products declined. The All Commodities WPI index increased to 110.2 in June from 109.9 in May. The Primary Articles index rose to 116.1 from 113.7, while the Fuel and Power index declined to 111.1 from 113.0. The Manufactured Products index remained unchanged at 107.8.

The June data is based on the revised Wholesale Price Index series with 2022-23 as the base year, introduced by the government last month to better reflect the current structure of the economy. The revised series expands the commodity basket to 957 items from 697 under the previous 2011-12 base year and includes newer products across sectors, including renewable energy sources such as solar and wind electricity, while also adding nuclear electricity to the basket.

The government also revised the final WPI inflation estimate for April 2026 to 8.36% from the provisional estimate of 8.26%, after revising the WPI index to 108.9 from 108.8. The provisional estimate for June was compiled with a weighted response rate of 82.6%, while the final estimate for April was based on a 97.5% weighted response rate. Overall, the June data showed wholesale inflation rising faster than expected, led by food and selected manufactured items, even as inflation in fuel and power moderated.