India's wholesale price inflation eased to a 13-month low of 0.85% in April 2025, helped by a decline in the prices of food items, fuel, and manufactured goods. Experts predict that rate could further decline in the coming month.
This marked a significant drop from the 1.19% inflation rate recorded over the same period last year and the 2.05% seen in March 2025, according to data released by the ministry of commerce and industry on Wednesday.
The ministry said, “Positive rate of inflation in April, 2025 is primarily due to an increase in prices of manufacture of food products, other manufacturing, chemicals and chemical products, manufacture of other transport equipment and manufacture of machinery and equipment, etc.”
Barclays, in a research note pointed, "Favourable base effects to keep WPI inflation low in coming months."
Food articles and vegetables witness sharp fall
Food inflation for the month stood at 0.26% up from March’s negative figure of 0.32%.
On a year-on-year basis, food articles recorded a deflation of 0.86% in April, compared to an inflation rate of 1.57% in March. Vegetables saw the steepest drop, with annual deflation widening to 18.26% in April from 15.88% in the previous month. Notably, potato prices fell by 24.3% year-on-year, while onion inflation plummeted from 26.65% in March to just 0.20% in April.
Other categories such as pulses also registered significant deflation at 5.57%, while inflation in fruits rose to 8.38%. Dairy products like milk saw a modest increase of 0.59%, whereas prices of eggs, meat, and fish declined slightly by 0.29%.
Fuel and power prices slide further
Fuel and power inflation slid to -2.82% in the month of April, down from March’s 0.6.5%.
The fuel and power category saw an annual deflation of 2.18% in April compared to a slight inflation of 0.20% in March. The drop was led by falling prices in mineral oils like kerosene by 3.95% and electricity by 1.38%. Petrol and diesel prices fell by 7.70% and 5.04% respectively on a monthly basis.
"Sharp sequential decline in prices of mineral oils such as kerosene (which was also reflected in consumer prices) and ATF and motor fuels, drove this fall," Barclays said.
Manufactured products
Inflation for manufactured products inched at 0.35%, up from 0.28% in March.
Rahul Agrawal, senior economist at ICRA, noted that IMD's forecast of an early monsoon onset in Kerala and an above-average monsoon across the country is promising for crop production, which in turn gives a positive outlook for food inflation.
However, he also added that the distribution of the monsoon, both geographically and over time, will be crucial.
"We expect the WPI to average sub-2 per cent in FY2026, which, along with our CPI inflation and real GDP projections for the fiscal implies that nominal GDP growth may be capped at 9 per cent," Agrawal said.
Retail inflation eases, opening policy room for RBI
Retail inflation, which is the apex bank's primary gauge for monetary policy, dropped to 3.16% in April, the lowest since July 2019. The easing was attributed to muted prices of vegetables, fruits, pulses, and protein-rich items.
The moderation in both retail and wholesale inflation may pave the way for another rate cut in the upcoming RBI monetary policy review in June. The central bank had already cut its benchmark policy rate by 0.25 percentage points in April to 6%, to support growth amid external headwinds such as the threat of US reciprocal tariffs.
The RBI has revised its inflation forecast for the current fiscal to an average of 4%, down from the previous estimate of 4.2%.
Data released on Tuesday showed that retail inflation also dropped to a near six-year low of 3.16% in April, primarily driven by lower prices of vegetables, fruits, pulses, and other protein-rich foods.
This marked a significant drop from the 1.19% inflation rate recorded over the same period last year and the 2.05% seen in March 2025, according to data released by the ministry of commerce and industry on Wednesday.
The ministry said, “Positive rate of inflation in April, 2025 is primarily due to an increase in prices of manufacture of food products, other manufacturing, chemicals and chemical products, manufacture of other transport equipment and manufacture of machinery and equipment, etc.”
Barclays, in a research note pointed, "Favourable base effects to keep WPI inflation low in coming months."
Food articles and vegetables witness sharp fall
Food inflation for the month stood at 0.26% up from March’s negative figure of 0.32%.
On a year-on-year basis, food articles recorded a deflation of 0.86% in April, compared to an inflation rate of 1.57% in March. Vegetables saw the steepest drop, with annual deflation widening to 18.26% in April from 15.88% in the previous month. Notably, potato prices fell by 24.3% year-on-year, while onion inflation plummeted from 26.65% in March to just 0.20% in April.
Other categories such as pulses also registered significant deflation at 5.57%, while inflation in fruits rose to 8.38%. Dairy products like milk saw a modest increase of 0.59%, whereas prices of eggs, meat, and fish declined slightly by 0.29%.
Fuel and power prices slide further
Fuel and power inflation slid to -2.82% in the month of April, down from March’s 0.6.5%.
The fuel and power category saw an annual deflation of 2.18% in April compared to a slight inflation of 0.20% in March. The drop was led by falling prices in mineral oils like kerosene by 3.95% and electricity by 1.38%. Petrol and diesel prices fell by 7.70% and 5.04% respectively on a monthly basis.
"Sharp sequential decline in prices of mineral oils such as kerosene (which was also reflected in consumer prices) and ATF and motor fuels, drove this fall," Barclays said.
Manufactured products
Inflation for manufactured products inched at 0.35%, up from 0.28% in March.
Rahul Agrawal, senior economist at ICRA, noted that IMD's forecast of an early monsoon onset in Kerala and an above-average monsoon across the country is promising for crop production, which in turn gives a positive outlook for food inflation.
However, he also added that the distribution of the monsoon, both geographically and over time, will be crucial.
"We expect the WPI to average sub-2 per cent in FY2026, which, along with our CPI inflation and real GDP projections for the fiscal implies that nominal GDP growth may be capped at 9 per cent," Agrawal said.
Retail inflation eases, opening policy room for RBI
Retail inflation, which is the apex bank's primary gauge for monetary policy, dropped to 3.16% in April, the lowest since July 2019. The easing was attributed to muted prices of vegetables, fruits, pulses, and protein-rich items.
The moderation in both retail and wholesale inflation may pave the way for another rate cut in the upcoming RBI monetary policy review in June. The central bank had already cut its benchmark policy rate by 0.25 percentage points in April to 6%, to support growth amid external headwinds such as the threat of US reciprocal tariffs.
The RBI has revised its inflation forecast for the current fiscal to an average of 4%, down from the previous estimate of 4.2%.
Data released on Tuesday showed that retail inflation also dropped to a near six-year low of 3.16% in April, primarily driven by lower prices of vegetables, fruits, pulses, and other protein-rich foods.
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