India Wholesale Inflation Falls 0.39% May Near 14-Month Low

India's wholesale inflation rate eased to a 14-month low of 0.39% in May 2025, down from 0.85% in April, marking the third consecutive month of decline in the Wholesale Price Index (WPI). This easing reflects sustained moderation in food inflation and a concurrent drop in retail inflation to a near six-year low of 2.82%. The decline in inflation has enabled the Reserve Bank of India (RBI) to cut interest rates by 50 basis points in June, following earlier cuts in February and April, bringing the repo rate to 5.5%. Economists anticipate further rate cuts in 2025 if disinflation continues, with the RBI revising its FY26 inflation forecast down to 3.7% from 4%. The inflation drop is influenced by contractions in primary articles and fuel and power inflation, while manufactured products inflation grew modestly. Overall, the data suggests a favorable environment for monetary easing in India amid subdued inflationary pressures.