Wholesale inflation pressure in the country increased further in August 2026. According to the data released by the government on Monday, the inflation rate based on Wholesale Price Index increased to 9.92 percent (WPI Inflation August 2026) in August. In July this figure was 9.78 percent. That means, within a month, an increase of 0.14 percentage points was recorded in wholesale inflation.
The increase in prices of food items, manufactured products and fuel has been considered to be the main reason behind this rise in inflation. According to the government, mineral oil, food articles, manufacturing of food products, basic metals, non-food articles and chemicals and chemical products played an important role in increasing wholesale inflation in August.
Food inflation also increased, price pressure continues
Food index based inflation increased to 7.05 percent in August, whereas it was 6.65 percent in July. It is clear from this that the pressure on the prices of food items in the wholesale market has increased compared to last month.
If this rise in food prices continues further, it may impact the retail market in the future. Especially monsoon, supply of crops and availability situation in the market will be important in deciding the direction of food inflation.
Manufacturing inflation at record level
There was also a rise in the prices of manufactured products during August. Wholesale inflation of this category was 8.37 percent, whereas in July it was 8.29 percent. According to the available series, this has been said to be the highest level till date.
The rise in prices of many sectors including basic metals and chemicals and chemical products pushed up manufacturing inflation. Increasing production costs may put pressure on companies’ profits. At the same time, if companies pass the burden of increased costs on to customers, then many finished products may become expensive in the future.
22.93% inflation in fuel and electricity
In August, wholesale inflation in the fuel and electricity category stood at 22.93 percent. According to the government, the rise in prices of mineral oil i.e. petroleum products contributed significantly to this.
The impact of fuel becoming expensive is not limited to petroleum products only. Due to increase in the cost of transport, logistics and production, it can also affect the prices of other goods and services.
West Asia war and Hormuz crisis are also big reasons
According to the government, the ongoing war in West Asia and the resulting blockade of the Strait of Hormuz have put pressure on global crude oil and fertilizer costs.
India imports a large part of its crude oil requirement. In such a situation, if oil becomes expensive in the international market, the country’s import cost may increase. Similarly, the increase in fertilizer prices can impact farmers’ costs and, in the future, food prices.
Inflation challenge increases before RBI
This increase in wholesale inflation can also increase the challenge for the Reserve Bank of India. Last month, the Monetary Policy Committee had maintained the policy rate at 5.25 percent. RBI has estimated retail inflation at 5 percent for the financial year 2026-27.
Now in the coming months, international crude oil prices, situation in the Strait of Hormuz, monsoon and food prices will be important in determining the direction of inflation. If the rise in energy and food prices continues for a long time, inflation expectations may come under pressure.
