Inflation nears double digits, common man in distress for 4 months

Wholesale Price Index (WPI) based inflation rose to 9.92% in August 2026.

Wholesale Price Index (WPI) based inflation in the country rose to 9.92 percent in August 2026. It was 9.78 percent in July. According to data released by the Ministry of Commerce on September 14, the increase in wholesale inflation is attributed to rising prices of fuel, processed food products, and chemicals. However, inflation in primary goods showed some moderation.

According to a report by Money Control,

wholesale inflation has remained close to double digits for four consecutive months. It was 3.98 percent in March, which increased to 8.36 percent in April and 9.88 percent in May. In June, wholesale inflation was revised to 9.97 percent, while it slightly decreased to 9.78 percent in July.

The initial estimate of the inflation rate for June has also been revised from 9.87 percent to 9.97 percent. In August, the fuel and power category remained the largest source of pressure on wholesale prices. Inflation in this category rose from 20.05 percent in July to 22.93 percent in August.

WPI inflation for manufactured products, which have the highest weight, also increased from 8.29 percent to 8.37 percent. Inflation in mineral oils within the fuel and power category rose from 32.40 percent to 38.48 percent.

Meanwhile, inflation for crude petroleum and natural gas increased from 26.99 percent to 34.41 percent. Prices of coal and lignite rose by 1.57 percent on a year-on-year basis. In July, there was a decline of 0.56 percent in these prices. On the other hand, electricity prices recorded a year-on-year decrease of 1.73 percent.

The fuel and power index rose from 105.4 in July to 108.3 in August. The mineral oil index increased from 113.2 to 118.4, and the crude petroleum and natural gas index rose from 114.8 to 120.3.

During August, the pressure on food prices also increased. Inflation based on the broad WPI food index rose from 6.65 percent in July to 7.05 percent in August. There has been a consistent rise in food inflation over the past few months.

In March, food index-based inflation was merely 1.92 percent. It increased to 3.29 percent in April, 4.58 percent in May, and 6.23 percent in June. Inflation in primary food items rose from 5.44 percent in July to 5.67 percent in August. Meanwhile, inflation in processed food products surged from 8.89 percent to 9.65 percent.

Price pressures in the manufacturing sector remained widespread, although the situation varied across different industries. Inflation in chemicals and chemical products rose from 13.12 percent to 14.30 percent. Inflation in rubber and plastic products also increased from 10.38 percent to 11.18 percent. The renewed military clashes in West Asia have impacted these industries as well. In contrast, prices of computer, electronic, and optical products recorded a year-on-year decline of 0.47 percent. Inflation in pharmaceutical products decreased from 4.75 percent in July to 3.40 percent in August. Along with the WPI data, the government also released provisional estimates for the Output Producer Price Index (Output PPI).

The all-India Output PPI for all commodities rose from 109.9 in July to 110.8 in August. However, the picture of producers' input costs was quite different. The government’s test-based Input Producer Price Index (IPPI) for the manufacturing sector fell from 105.9 in July to 104.2 in August.

The difference in input prices related to petroleum was the most significant. The input price index for coke and refined petroleum products fell from 99.9 in July to 86.7 in August. In May, this index was at the level of 111.8.