Wholesale Inflation Surges to 9.87% in June: Food and Minerals Lead the Spike
India's wholesale price inflation rose to 9.87% in June, up from 9.68% in May, driven primarily by sharp increases in food and mineral prices, according to data released by the Commerce and Industry Ministry on Tuesday.
The Wholesale Price Index (WPI) for June showed that food articles inflation accelerated to 5.49%, compared to 3.60% in May. Non-food articles inflation stood at 11.07%, while minerals recorded a 9.45% rise. Manufactured products inflation remained unchanged at 7.48%.
Fuel and power inflation moderated to 27.41% in June from 30.33% in May, though it remains at an elevated level. The ministry attributed the overall rise to the combined effect of mineral oils (including petroleum products), food articles, basic metals, and chemicals.
The spike in global energy prices due to geopolitical tensions—including the ongoing West Asia crisis and disruptions in the Strait of Hormuz, a key crude oil transit route—has contributed to higher input costs. These pressures have begun to spill over into food prices, the ministry noted.
The WPI data comes amid rising retail inflation. Consumer price index (CPI)-based inflation surged to a 17-month high of 4.38% in June, up from 3.93% in May. The Reserve Bank of India (RBI), which primarily targets CPI inflation, is mandated to keep headline inflation at 4% with a tolerance band of 2 percentage points on either side.
In its June monetary policy review, the RBI raised its inflation projection for the current fiscal year to 5.1% from 4.6%, citing the pass-through of higher global energy prices to domestic petrol and diesel prices. The central bank has held the repo rate steady at 4% but signaled readiness to act if inflationary pressures persist.
Experts caution that sustained high WPI inflation could eventually feed into retail prices, complicating the RBI's task of keeping inflation within the target band. The government, for its part, has taken steps to cool food prices by releasing buffer stocks and easing import duties on essential commodities.
