India's Wholesale Price Index-based inflation eased to 1.8% in April 2026, down from 2.3% in March, as global commodity prices moderated and domestic manufacturing cost pressures subsided. The fuel and power component of WPI saw deflation of 0.8% as global crude oil prices fell below $72 per barrel, while primary food article prices rose a moderate 3.2% driven by seasonal vegetable price increases as the summer crop supply lag sets in.
Manufactured products, which carry the highest weight in the WPI basket at 64.2%, saw inflation ease to 2.1% from 2.8% in March, reflecting lower input costs for metals, chemicals and textiles. The moderation in WPI inflation is a positive sign for corporate margins as it suggests a benign cost environment for manufacturers, which should support earnings growth and investment in production capacity.
Economists note that the WPI-CPI gap, which had been elevated at over 2 percentage points for much of FY26, is now narrowing as wholesale prices moderate faster than retail prices. This convergence typically indicates that pipeline inflation pressures are easing and provides comfort to the RBI that the rate cut cycle can continue without reigniting inflationary pressures. The next WPI data release for May is expected to show further moderation toward 1.5%, which would be the lowest since mid-2023.
