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Wholesale price inflation rose to a 11-month high of 2.13% in February, driven by an uptick in prices of food and non-food articles, even though vegetable prices eased on a month-on-month basis, government data showed on Monday (March 16, 2026).
This is the fourth straight month of rise in Wholesale Price Index (WPI)-based inflation. It was 1.81% in January and 2.45% in February last year.
Economists said the WPI inflation is likely to pick up pace further if the oil price rise persists, and spills over to other goods (fertilisers, aluminium) given it tracks international prices more closely relative to the CPI basket.
According to WPI data, inflation in food articles was 2.19% in February, as against 1.55% in the previous month.
Although in vegetables, inflation eased to 4.73% in February against 6.78% in January, pulses, potato and egg, meat and fish saw an uptick in inflation in February.
“Positive rate of inflation in February 2026 is primarily due to an increase in prices of other manufacturing, manufacture of basic metals, non-food articles, food articles and textiles, etc.,” the Industry ministry said in a statement.
Negative inflation, or deflation, in the fuel and power basket narrowed to 3.78% in February, vis-a-vis 4.01% in January. Global oil prices averaged $68/bbl in February from $63/bbl in January.
Barclays in a research note said the passthrough of the rise in crude oil prices from the Middle East conflict will reflect more in WPI inflation vs retail CPI inflation, as retail fuel prices are unchanged in the latter.
“With a sharp jump in crude oil prices crossing USD100/bbl as of 16 March, the corresponding WPI will likely reflect this in the March print,” Barclays said.
India Ratings and Research the rising crude oil prices since the U.S.-Iran war will have a strong impact on wholesale inflation from March 2026, till the supply side issues are resolved.
The average price of Indian crude basket March 2026 (up to March 12) touched a 44-month high of $101.25/bbl. Ind-Ra Chief Economist Devendra Pant expects wholesale inflation to stay high amidst U.S.-Iran war and a low base.
“The retail prices of petroleum products might remain the same for some time, which may negate any sharp jump in retail inflation. However, the increase in crude oil prices will push wholesale inflation higher. Ind-Ra expects wholesale inflation in March to jump to 3.7%,” Mr. Pant said.
As per WPI data for February, inflation in manufactured products inched up to 2.92% in February, from 2.86% in the preceding month.
Non-food articles category inflation spiked to 8.80% in February, from 7.58% in January.
PHDCCI president Rajeev Juneja said given the geopolitical risks, a continued policy focus on improving supply-chain efficiencies, lowering logistics costs, supporting domestic manufacturing, and ensuring adequate availability of critical inputs for industry is critical to contain cost-push pressures.
As per data released last week, India’s retail inflation rose to 3.2% in February, from 2.75% in January.
The Reserve Bank of India (RBI) has reduced policy interest rates by 1.25 percentage points in the current fiscal year as inflation remained low. The RBI mainly tracks retail inflation for deciding on benchmark interest rates.
Published – March 16, 2026 09:59 pm IST
