The year-on-year (YoY) WPI inflation moderated to a marginal 0.1% in September 2025 from 0.5% in August 2025, mainly pulled down by the deflation in WPI-food index (primary food + manufactured food items), and the dip in primary non-food inflation. While the core-WPI inflation rose to a 31-month high of 1.8% in September 2025 (+1.6% in August 2025), this was attributed to an unfavourable base. Moving ahead, the YoY prints for most food prices have trended lower in October 2025 so far, compared to September 2025, which combined with a favourable base would further deepen the deflation in WPI-food index from 2.0% in September 2025. The WPI appears set to witness a base-effect led deflation of 0.8-1.0% in October 2025 (+2.8% in October 2024), after a gap of two months. Nevertheless, the uptrend in global commodity prices and depreciation in USD/INR pair needs to be monitored.

• WPI inflation moderated to just 0.1% in September 2025: The WPI recorded a YoY inflation for the second consecutive month in September 2025, although the pace of the same eased to 0.1% from 0.5% in August 2025. This was mainly driven by the turnaround in WPI-food index to a deflation (to -2.0% in September 2025 from +0.2% in August 2025) and dip in primary non-food inflation (to +3.1% from +5.6%) between these months.
• WPI rose by 0.1% in H1 FY2026, much lower than the average 2.2% inflation in CPI: In H1 FY2026, the WPI rose by a meagre 0.1% YoY, mainly dampened by the deflation in primary food articles (-3.3%) and crude petroleum and natural gas (-10.5%), even as core-WPI witnessed an uptick of 1.3%. The average WPI inflation in H1 FY2026 is much lower than the average CPI inflation of 2.2% seen during the period.