India's wholesale price index (WPI) continued its disinflationary trend, easing to 0.39 % year‑on‑year in May 2025. This marks the lowest reading in six months and reflects broad‑based moderation across key commodity groups.
Headline Numbers at a Glance
Category (YoY) | Dec‑24 | Jan‑25 | Feb‑25 | Mar‑25 | Apr‑25 (P) | May‑25 (P) |
All Commodities | 2.57 % | 2.51 % | 2.45 % | 2.25 % | 0.85 % | 0.39 % |
Primary Articles | 6.02 % | 4.58 % | 2.92 % | 1.26 % | –1.44 % | –2.02 % |
Fuel & Power | –2.57 % | –1.87 % | –0.97 % | 0 % | –2.18 % | –2.27 % |
Manufactured Products | 2.14 % | 2.65 % | 3 % | 3.21 % | 2.62 % | 2.04 % |
Food Index | 8.95 % | 7.52 % | 6.17 % | 4.93 % | 2.55 % | 1.72 % |
P = Provisional; Source: Ministry of Commerce & Industry
Key Drivers of the Slowdown
1. Primary Articles Turn Negative
- Inflation for primary articles fell from 6.02 % in December to –2.02 % in May, reflecting improved agricultural supplies and softer global commodity trends.
2. Persistent Fuel Deflation
- Fuel & Power remained in deflationary territory for the fifth consecutive month, deepening to –2.27% as global crude prices stabilized and domestic tax adjustments took effect.
3. Cooling Food Inflation
- The Food Index decelerated sharply—from 8.95% to 1.72%—suggesting that supply-chain normalization and a favorable base are easing price pressures.
4. Stable Core Manufacturing Costs
- Manufactured Products inflation moderated but remained positive at 2.04 %, indicating that core input costs are steady rather than contractionary.
Sectoral Implications
Sector | Input‑Cost Signal |
FMCG & Retail | Lower raw‑material inflation may aid margin stability. |
Capital Goods | Softer metals pricing keeps project costs in check. |
Energy | Continued fuel deflation tempers downstream pricing. |
Agri Inputs | Falling primary‑article costs may relieve fertiliser makers. |
Note: These observations describe cost trends, not investment recommendations.
Bottom Line
The latest data confirm a broad‑based disinflation trend in India's wholesale prices, led by negative growth in primary articles and sustained fuel deflation. While easing input costs is a relief for producers, persistent weakness in core commodity groups warrants close monitoring to gauge the durability of the trend and its pass‑through to consumer inflation.
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