New Delhi — In a major economic relief for millions battling the burden of high living costs, India’s wholesale inflation rate has dropped to its lowest point in the past 20 months. According to data released by the Ministry of Commerce and Industry on Monday, the Wholesale Price Index (WPI)-based inflation for June 2025 has eased to just 0.13%, down from 0.39% in May and 0.85% in April, reflecting a sustained downward trend.
The decline in wholesale inflation is largely attributed to a sharp reduction in the prices of food items, mineral oils, and basic metals — with the impact of falling input and transportation costs increasingly visible across sectors. The drop also indicates that government efforts, particularly those targeting food and fuel affordability, are beginning to yield tangible results.
Food prices saw a significant 3.75% drop in June, compared to a 1.56% decline in May. The vegetable category registered the most pronounced decline, with prices plunging by 22.65% in June, down from 21.62% in the previous month. Meanwhile, inflation in manufactured products stood at 1.97% in June, a slight dip from 2.04% in May.
The fuel and power segment, however, showed a marginal increase with WPI inflation rising to 2.65% in June, compared to 2.27% in May. Still, the moderation in other categories was enough to pull the overall inflation rate to a near-zero level.
Experts believe the Reserve Bank of India’s recent monetary policy adjustments have played a crucial role in containing inflation. The RBI had slashed the repo rate by 50 basis points, bringing it down to 5.50%, in an attempt to stimulate demand and provide economic support amid softening inflationary trends.
Reflecting this outlook, the RBI had revised its retail inflation forecast for FY 2025-26 from 4% to 3.7%, predicting inflation at 2.9% in Q1, 3.4% in Q2, 3.9% in Q3, and 4.4% in Q4.
Economists suggest that if this trend continues, it could pave the way for increased consumer spending, more policy space for the central bank, and improved investor confidence — all critical for India’s economic recovery momentum.
While challenges remain, especially with global fuel price volatility and erratic monsoons affecting agricultural output, the current data signals a welcome phase of inflationary ease for both producers and consumers alike.
