New Delhi [India], September 11 : Wholesale inflation in India likely turned positive in August 2025, rising to 0.45 per cent year-on-year after recording a contraction of -0.58 per cent in July, according to a report by Union Bank of India (UBI).
The report highlighted that the Wholesale Price Index (WPI) bounced back after touching a recent low in July, supported by broad-based gains across food, fuel, and core segments.
The shift also reflected the fading impact of a high base, with WPI at 1.25 per cent in August 2024 compared to 2.10 per cent in July 2024.
The report stated, "Wholesale Price Index (WPI), in our opinion, turned positive in August'25 after making a recent low of -0.58 per cent in July'25"
The report expected that the food inflation, which had been in deflation for the past two months, returned to positive territory in August. It is expected to be at a three-month high of 0.21 per cent against -2.14 per cent in July.
The rise in food prices was broad-based, with almost all sub-segments witnessing a sequential strengthening.
Core inflation also picked up momentum, rising to 1.69 per cent in August from 1.20 per cent in July. Similarly, fuel inflation showed some improvement, easing from -3.84 per cent in July to -3.53 per cent in August.
The report noted that apart from domestic factors, external elements will continue to influence wholesale inflation trends in the coming months.
The report pointed out that global commodity prices could remain volatile due to uncertainty over shifting trade scenarios, particularly following increased US tariffs and ongoing geopolitical tensions.
On the domestic front, the report cautioned that weather-related disruptions and supply chain concerns could impact WPI dynamics in the short term.
However, it added that upcoming GST reforms are expected to provide relief to wholesale inflation from October.
The report estimated at least a 60-basis-point impact on CPI, based on a conservative assumption of partial pass through from the 130-bps expected overall impact.
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