The WPI reverted to a year-on-year (YoY) deflation of 1.2% in October 2025 after a gap of two months, while printing largely in line with ICRA’s estimate of 1.0%. An elevated base in the WPI-food segment pushed down the deflation in this category to a series low of 5.0% from 2.0% in September 2025, pulling down the headline print by ~96 bps between these months. Most of the other sub-groups, barring fuel and power, also witnessed a softening in their YoY prints between these months. Going forward, as the favourable base dissipates, the deflation in the WPI-food category appears set to narrow in November 2025 and chart an upward trajectory till Q1 FY2027. Given this and the uptrend in global commodity prices, ICRA projects that WPI deflation will narrow to 0.5% in November 2025. While the headline prints are expected to see an upward trajectory, the average WPI inflation for FY2026 will be marginal.

• Sharper-than-expected 1.2% fall in WPI in October 2025: A high base and continued cooling in food prices pushed the WPI back into the deflationary zone after a gap of two months, to 1.2% YoY in October 2025.
  
• Food index down by 5% YoY in October 2025, the lowest in current series: The downtick was broad based across most sub-groups, including WPI-food, crude petroleum and natural gas, and non-food manufactured products.

Source: Office of the Economic Advisor, Ministry of Commerce and Industry, GoI; ICRA Research