Very good news is coming out on the inflation front for the country. The wholesale inflation rate in India has come down significantly in the month of May. A sharp decline in inflation has been recorded between April and May. While this rate was 0.85 percent in April, it has come down to 0.39 percent in May.
This wholesale inflation rate has reached the lowest level in the last 14 months! The common man will get a direct benefit from this because the prices of food items and essential goods have come down. Earlier in March 2024, the wholesale inflation rate was 0.26 percent. On the other hand, if we talk about April, then the wholesale inflation rate has come down from 2.05 percent to 0.85 percent
Which things became cheaper
The effect of the reduction in food items can be seen in the wholesale inflation data. This will also have a positive effect on your monthly budget. The inflation rate of food items (Food Index) has come down from 2.55% to 1.72%. This means that grains, vegetables, pulses, and other food items are now available cheaper than before. The wholesale inflation rate of fuel and power has come down from -2.18% to -2.27% (-2.27%).
This reflects the reduction in the cost of energy. The wholesale inflation rate of manufactured products has come down from 2.62% to 2.04% (2.04%). This includes clothes, machinery, and other consumer goods. All these declines together are making shopping in the market more affordable for the common consumer.
Lowest level in 6 years
Before the wholesale inflation figures, the government had released the retail inflation figures, which were also quite relieving. According to the data released on June 12, India’s retail inflation fell to 2.82% (2.82%) in May 2025, which is the lowest level in the last six years. Earlier it was 2.86% in March 2019. Retail inflation has softened due to a steady decrease in the prices of food items.
Retail inflation was 3.16% in April 2025, while it was 3.34% in March, which was the lowest level in 67 months. Retail inflation has remained below RBI’s target of 4% since February, which is a positive sign for the central bank and may increase the possibility of a cut in policy rates in the future.
How inflation is measured
Different products are used to measure retail and wholesale inflation. Different items are included to measure inflation, which have different weights:
Components of Wholesale Inflation (WPI)
Manufactured Products: 63.75%
Primary Articles (such as food items): 22.62%
Fuel and Energy: 13.15%
Components of Retail Inflation (CPI)
Food Items and Products: 45.86%
Housing: 10.07%
