India’s wholesale inflation likely rose to 0.80% year-on-year in June 2025, up from 0.39% in May, driven by higher month-on-month prices in food, fuel, and core categories, according to a report released by Union Bank of India.
The report attributes the uptick primarily to a sharp increase in core inflation, which excludes food and fuel items. Core WPI rose from 0.86% in May to 1.63% in June, fueled by rising global commodity prices.
“June ’25 WPI likely spiked due to commodity prices-led rise in core inflation… reversing from May’s recent low of 0.39%,” the report stated.
While annual food inflation moderated, the month-on-month food price index increased, pushing food WPI down to 0.60% in June, from 1.72% in May.
Fuel inflation, though still negative, showed a slower rate of contraction. It was estimated at (-)1.82% in June, compared to (-)3.87% in May, signaling a possible reversal in trend if price pressures persist.
The report warned of multiple risk factors that could drive inflation higher in the coming months. These include:
- Volatile global commodity prices amid ongoing tariff disputes and geopolitical tensions.
- Uncertain agricultural output, depending on the progress and distribution of the monsoon.
- Potential weather disruptions and global supply chain challenges that could affect food and fuel prices.
Despite the moderate current reading, the report stressed that inflation risks remain skewed to the upside, and emphasized the need for close monitoring of both international and domestic developments.
