Inflation watch: WPI rises to 0.52% in August after two months of deflation; food, manufacturing push prices higher

India’s wholesale price inflation (WPI) moved back into the positive zone in August, rising to 0.52 per cent after staying in deflation for two straight months, according to government data released on Monday. WPI had recorded (-) 0.58 per cent in July and (-) 0.19 per cent in June, while it stood at 1.25 per cent in August last year, PTI reported.“Positive rate of inflation in August 2025 is primarily due to an increase in prices of food products, manufacturing, non-food articles, non-metallic mineral products and transport equipment etc,” the ministry of commerce and industry said in its statement.Food articles, which were in steep deflation in July at 6.29 per cent, saw a softer decline of 3.06 per cent in August, with vegetable prices witnessing sharp sequential gains. Deflation in vegetables narrowed to 14.18 per cent in August, compared to 28.96 per cent in the previous month. Manufactured products also saw higher inflation at 2.55 per cent in August, up from 2.05 per cent in July.On the other hand, the fuel and power segment remained in deflation at 3.17 per cent in August, compared with 2.43 per cent in July.According to a recent Union Bank of India report, the return of WPI to positive territory was expected as base effects faded and prices strengthened across food, fuel, and core segments. The report had noted that core inflation rose to 1.69 per cent in August from 1.20 per cent in July, while fuel inflation also showed slight improvement.At the retail level, inflation inched up to 2.07 per cent in August after easing for nine consecutive months, driven mainly by higher prices of vegetables, meat, fish, and eggs, data released last week showed. The Reserve Bank of India, which tracks consumer price inflation for its monetary policy, had left benchmark policy rates unchanged at 5.5 per cent in its last review.