India's (wholesale price index) WPI inflation rose to 11.39% in September 2026 from 9.92% in August, driven by the increase in prices of food articles, manufactured products, and fuel and power. The government report on Wednesday revealed rising pressures on some of the major areas of the economy. Furthermore, retail inflation jumped to 5.54% in September 2026 from 4.83% seen in August.

Key Highlights

• WPI inflation hit a new high of 11.39% in September, due to an increase in food, manufactured goods and fuel prices.
• Retail inflation rose to a 23-month high of 5.54% in the month, adding to the worry of inflation for households and complicating the outlook for India.

Wholesale inflation increased at the same time the consumer price index (CPI)-based retail inflation jumped to a 23-month high of 5.54% in September from 4.83% in August. Higher food prices, and higher energy prices, played a role in the increase in inflation in both wholesale and retail markets.

Concurrently, the two inflation indexes have surged, putting the pressure on inputs and household price inflation on the agenda, especially given the ongoing volatility in global energy and commodities markets.

WPI Inflation in September: Food, Manufacturing and Fuel Prices Rise

WPI inflation on food rose to 8.66% in September from 7.05% in August. The inflation of manufactured products was 9.76%, up from 8.37% the month before, to reach its highest point since the data were released.

The inflation rate for fuel and power was also higher, climbing to 25.85% in September from 22.93% in August. The 12-month growth rate of primary articles inflation is also higher at 8.67% than 7.76% in the corresponding period.

The wholesale price level increased in September, when the All India WPI went up to 112.5 from 110.8 in August.

Mineral oils, food articles, crude petroleum and natural gas, coal and lignite, basic metals, chemicals and chemical products, textiles, rubber and plastic products and electrical equipment were the top contributors to wholesale inflation according to the Commerce and Industry Ministry.

West Asia Conflict Adds to Fuel and Commodity Price Pressures

This increase in wholesale inflation in India comes as geopolitical uncertainties remain and the disruption of energy and commodity supply chains persist. War in West Asia and shipping disruptions in the Strait of Hormuz have pushed up crude oil and fertiliser prices, and may have a spillover effect on food and other commodity prices.

India is highly dependent on crude oil imports and, therefore, is extremely sensitive to the international oil price. Increased costs for transportation and production may occur if fuel prices are higher, and higher raw material costs may result in higher manufacturing costs in a variety of industries.

These higher input costs could place more strain on operating margins or cause businesses to raise the cost of their products/services. This could be a catalyst to keep inflationary pressures alive in the wholesale sector and eventually in retail sector.

Retail Inflation Reaches a 23-Month High in September

India's retail inflation, based on the Consumer Price Index (CPI), in September 2026 was 5.54%, compared to 4.83% in August. The rise was led by a significant jump in food inflation, which is the highest it has been in 23 months.

WPI reflects the price changes at the wholesale level while CPI reflects the price changes experienced by the consumers while purchasing goods and services. Changes in wholesale prices may slowly work their way through to retailers' prices, depending on various factors including retail demand, competition, distribution costs, and firms' price setting.

Both wholesale and retail inflation rates have ticked up, indicating that price pressures are percolating up the supply chain.

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RBI Monetary Policy and Inflation Outlook

According to the data, last week the RBI's MPC hiked the policy rate by 25 basis points to 5.50%. The inflationary pressures and the changing economic landscape are still relevant in the context of the monetary policy.

If energy, food and commodity prices continue to rise, the new WPI and CPI data will pose a challenge to the inflation picture. Household purchasing power can be impacted by ongoing inflation, as well as business costs and the interest rate decision-making process.

Looking ahead, the price of crude oil, West Asia developments, food price fluctuations and how wholesale prices are being passed on to retail prices will continue to be key considerations for India's inflationary situation.