Key Points
India's wholesale inflation edges up slightly in February
Food index decreases from 7.47% to 5.94%
Positive inflation driven by manufacturing and food products
RBI recently reduced repo rate to boost growth
The Food Index, consisting of 'food articles' from the primary articles group and 'food products' from the manufactured products group, decreased from 7.47 percent in January 2025 to 5.94 percent in February 2025.
The positive rate of inflation in February 2025 was primarily due to an increase in the prices of manufactured food products, food articles, other manufacturing, non-food articles and the manufacture of textiles, etc.
In December, the wholesale inflation print was at 2.57 per cent.
The government releases index numbers of wholesale prices on a monthly basis on the 14th of every month (or the next working day). The index numbers are compiled with data received from institutional sources and selected manufacturing units across the country.
Wholesale inflation continues to remain in the positive territory for over a year now. Economists often say a little rise in wholesale inflation is good as it typically incentivizes goods manufacturers to produce more.
In April last year, wholesale inflation went into negative territory. Similarly, in July 2020, in the initial days of COVID-19, the WPI was reported negative.
Notably, wholesale price index (WPI)- based inflation was in the double digits for 18 months in a row until September 2022.
The country had been facing high food inflation over the past few months, mainly due to an increase in the inflation of vegetables, fruits, oils and fats. It now seems to have abated.
The RBI had kept the repo rate elevated at 6.5 per cent for nearly five years to keep inflation contained. The repo rate is the rate of interest at which the RBI lends to other banks. The RBI has recently reduced the repo rate by 25 basis points to put a thrust on growth and consumption in the economy.
