Wholesale price inflation in India continued its upward movement for the third consecutive month, rising to 1.81 percent in January 2026, according to official data released by the government on Monday February 16, 2026.

The latest figures show that the Wholesale Price Index WPI based inflation has been gradually inching up, driven mainly by an increase in prices of food articles, non food articles and manufactured items on a month on month basis.

In comparison, WPI inflation stood at 0.83 percent in December 2025, indicating a noticeable rise in price pressures at the wholesale level. In January last year, wholesale inflation was recorded at 2.51 percent, suggesting that while the current rate is lower than last year, price momentum has clearly strengthened in recent months.

Third straight monthly increase

The January data marks the third consecutive month of rising wholesale inflation. After remaining relatively subdued in the middle of the fiscal year, wholesale prices have started to climb again.

Economists believe that this upward trend is mainly due to base effects, seasonal factors and fresh increases in certain commodity prices.

A consistent rise over three months indicates that price pressures are building gradually in the production and supply chain segments of the economy.

Food articles inflation turns positive

One of the key drivers of the January inflation print was the change in food prices.

According to WPI data, inflation in food articles was 1.55 percent in January, compared with a deflation of 0.43 percent in December 2025.

This shift from negative to positive territory played a significant role in pushing the overall wholesale inflation number higher.

Food articles include items such as vegetables, cereals, pulses, fruits, milk and other agricultural products. A rise in food inflation at the wholesale level can reflect higher mandi prices, seasonal supply constraints or increased demand.

Even a moderate rise in food prices tends to have a visible impact on overall WPI because food remains an important component in the index.

Non food articles add to pressure

Apart from food, prices of non food articles also recorded an increase on a month on month basis.

Non food articles include products such as oilseeds, fibres and other raw materials. These commodities are used as inputs in various industries.

An increase in their prices can raise production costs for manufacturers, which may eventually be passed on to consumers if the trend continues.

The rise in non food articles inflation suggests that input cost pressures may be gradually building in certain sectors.

Manufactured items show price uptick

The data also showed an increase in prices of manufactured items, which form a significant portion of the Wholesale Price Index basket.

Manufactured goods include processed foods, textiles, chemicals, metals, machinery and other industrial products.

A rise in prices of manufactured goods often indicates higher input costs, stronger demand or adjustments in pricing strategies by producers.

Since manufactured items have a large weight in the WPI, even small increases in this category can influence the overall inflation number.

Comparison with previous months

In December 2025, WPI inflation stood at 0.83 percent, which itself had shown an increase from earlier months.

The jump to 1.81 percent in January indicates that the pace of price rise has accelerated.

However, compared to January last year, when wholesale inflation was 2.51 percent, the current figure is lower.

This suggests that while inflationary pressures are returning, they are not yet at levels seen a year ago.

What WPI measures

The Wholesale Price Index measures changes in prices of goods at the wholesale level before they reach the retail market.

It tracks price movements in three main categories: primary articles, fuel and power, and manufactured products.

Unlike the Consumer Price Index CPI, which reflects prices faced by consumers, WPI captures price changes at an earlier stage in the supply chain.

Therefore, a sustained rise in wholesale inflation can sometimes signal potential increases in retail inflation in the future.

Implications for businesses

Rising wholesale prices can impact businesses in multiple ways.

For manufacturers, higher input costs may reduce profit margins if they are unable to pass on the cost increases to consumers.

Small and medium enterprises may feel greater pressure, especially if they operate with limited pricing power.

However, moderate inflation can also reflect improved demand conditions in the economy.

Businesses often adjust their pricing strategies depending on competition, consumer demand and overall economic outlook.

Impact on consumers

Although WPI does not directly measure consumer prices, persistent increases in wholesale prices can eventually affect retail prices.

If manufacturers and traders pass on higher costs to retailers, consumers may experience price increases in essential goods.

The transmission from wholesale to retail is not always immediate. It depends on several factors including inventory levels, competition and policy interventions.

For now, analysts say the January rise in WPI indicates emerging pressure but not a sharp spike.

Sector wise trends

Within food articles, price movements may vary across commodities.

Vegetables often show seasonal fluctuations depending on harvest cycles and weather conditions.

Cereal prices can be influenced by procurement policies and global market trends.

In manufactured goods, price increases in metals, chemicals or textiles can reflect global commodity movements.

The government monitors these sector wise trends to assess whether price pressures are temporary or structural.

Role of global factors

Global commodity prices play an important role in determining wholesale inflation in India.

Changes in crude oil prices, metal prices and agricultural commodity prices can affect domestic wholesale prices.

If global prices rise sharply, Indian producers may face higher import costs.

On the other hand, stable or declining global prices can help contain domestic inflation.

In January, a mix of domestic demand and commodity trends appears to have contributed to the rise in WPI.

Policy perspective

The inflation data comes at a time when policymakers are closely watching price trends.

While WPI is not the primary inflation measure used for monetary policy decisions, it provides valuable signals about supply side pressures.

If wholesale inflation continues to rise over the coming months, it may influence expectations about future retail inflation.

However, one month’s data is not enough to indicate a sustained trend. Policymakers typically look at broader patterns before making decisions.

Base effect considerations

Inflation numbers are often influenced by the base effect, which refers to the level of prices in the same month last year.

If last year’s prices were particularly low or high, the year on year comparison can show sharper changes.

In January 2026, the base effect may have played a role in the observed increase.

Economists will analyse detailed data to understand how much of the rise is due to base effects and how much reflects genuine price momentum.

Economic outlook

The moderate rise in wholesale inflation suggests that the economy may be witnessing gradual improvement in demand.

Higher demand can lead to better pricing power for producers.

At the same time, policymakers need to ensure that inflation remains within manageable levels.

A balance between growth and price stability remains important for sustaining economic momentum.

Challenges ahead

If food and input costs continue to rise, there could be pressure on businesses and households.

Supply side disruptions, weather conditions and global uncertainties can influence future price trends.

The government and regulatory authorities will continue to monitor price movements and take appropriate steps if necessary.

Conclusion

The rise in wholesale price inflation to 1.81 percent in January 2026 marks the third straight monthly increase, driven by higher prices of food articles, non food articles and manufactured goods.

Food inflation moved into positive territory at 1.55 percent, compared with deflation in December.

While the current rate remains below last year’s level of 2.51 percent, the upward trend signals emerging price pressures in the economy.

Going forward, analysts and policymakers will closely watch whether this rise continues or stabilises in the coming months.

For businesses and consumers alike, wholesale inflation trends remain an important indicator of the broader price environment and economic direction.

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