Wholesale prices rose to 11.39% on-year in September, from 9.92% in August, official data released by the commerce and industry ministry on Wednesday showed, due to a sharp rise in fuel and power, food and manufactured product prices.
A Reuters poll of economists had, earlier this month, estimated wholesale inflation at 10.18% for the month.
Meanwhile, data from earlier this week showed that the country’s retail inflation rose to 5.54% in September 2026 from 4.83% in August, owing to a sharp rise in food prices, particularly vegetables.
Inflation in fuel and power rose to 25.85% in September from 22.93% in August, while inflation in manufactured products increased to 9.76% from 8.37%.
Inflation in primary articles, which include food articles, non-food articles and minerals, rose to 8.67% from 7.76% over the same period.
The wholesale food index, which includes food articles and manufactured food products, recorded inflation of 8.66% in September, up from 7.05% in August.
Among the key drivers of wholesale inflation were mineral oils, food articles, crude petroleum and natural gas, coal and lignite, basic metals, chemicals, textiles, rubber and plastic products, and electrical equipment, the ministry said.
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An ET Online survey of economists from earlier this month, showed that food inflation is likely to remain elevated over the coming months, with some expecting it to rise to 7-8% over the next three to six months. While fresh Kharif arrivals and winter Rabi supplies could bring relief from late 2026 or early 2027, uneven monsoon rainfall, El Nino risks and higher energy and farm-input costs could prolong price pressures.
Economists flagged El Nino and uneven monsoon rainfall as key risks to food inflation, warning that they could affect Kharif yields and delay Rabi sowing. ICRA’s Aditi Nayar and ANZ’s Dhiraj Nim had flagged to ET Online that below-average reservoir levels are a concern for winter crops, with the impact on food prices depending on crop output and adverse weather conditions.
Higher global commodity prices and energy costs add to the pressure on food prices.
Elevated crude oil prices can raise farm, irrigation and transportation costs, while higher liquefied natural gas (LNG) prices can increase fertiliser costs. India’s dependence on imported edible oils also leaves the category exposed to global price movements, while higher freight, packaging and crop-protection costs could add to the cost of bringing food to market.
In early October, the RBI hiked benchmark repo rate to 5.5% in first such increase since February 2023, with Governor Sanjay Malhotra flagging “it is clear that inflation and its outlook are not benign as they were last year.”
The September WPI inflation data was released under the revised series, introduced in June with 2022-23 as the base year to better reflect the economy’s current structure. The new series expands the commodity basket to 957 items from 697 and includes newer energy sources such as solar, wind and nuclear electricity.