India’s Wholesale Inflation Drops to Four-Month Low in March

India’s wholesale inflation moderated to a four-month low in March 2025, driven by a slowdown in food price increases, according to provisional data released by the Ministry of Commerce & Industry.

The Wholesale Price Index (WPI), a key measure of producer-level inflation, rose by 2.05% year-on-year in March, down from 2.38% in February. The figure also came in below the 2.5% projected by economists in a Reuters poll.

Food prices, which constitute 24.38% of the WPI basket, recorded a 4.66% year-on-year rise in March, easing significantly from 5.94% in the previous month. Notably, vegetable prices declined further, contracting by 15.88% in March compared to a 5.80% fall in February. Cereal prices rose 5.49%, down from 6.77% a month earlier. Meanwhile, fruit prices remained elevated, increasing by 20.78%, nearly unchanged from February’s 20.88%.

In a move aligned with the improving inflation outlook, the Reserve Bank of India (RBI) last week reduced the repo rate by 25 basis points, marking a cumulative cut of 50 basis points in the current easing cycle. While the central bank’s Monetary Policy Committee acknowledged a decisive improvement in the inflation trajectory, it flagged potential risks arising from global market volatility and weather-induced supply disruptions.

Among other key components of the WPI, prices of manufactured products—which hold the largest weight of nearly 64%—rose by 3.07% in March, up from 2.86% in February. Fuel and power prices saw a marginal increase of 0.20%, rebounding from a 0.71% contraction in the previous month.

The index for primary articles, including food, non-food items, minerals, crude oil, and natural gas, registered a rise of 0.76% in March—markedly lower than the 2.81% growth reported in February. Non-food articles specifically rose by 1.75%, compared to a sharper 4.84% increase a month earlier.