New Delhi, June 15: Wholesale price inflation shot up to a record 9.68 per cent in May, from 8.26 per cent in April, led by a sharp spike in prices of fuel and power, reflecting the impact of energy shocks emanating from the West Asia war.
The May wholesale price index (WPI)-based inflation is the highest in the current series with a base year of 2022-23.
The Commerce and Industry Ministry on Monday released the May WPI-inflation data, revising the base year to 2022-23, from 2011-12 earlier — the first revision in nine years.
The total number of items in the new WPI basket has increased from 697 to 957. New sources of energy, such as solar and wind, have been added under the ‘electricity’ group. In addition, nuclear electricity has been included in the basket.
The ministry also released the producer price indices (PPI) for the first time to track output and input factory gate prices. Besides, Services PPI was released for seven services – Banking, Securities Transaction, Management of Pension Funds, Insurance, Railways, Air (Passenger), and Telecom.
The government intends to discontinue with WPI data in the next five years and shift to PPI, in alignment with the global best practice.
“Availability of both the Output PPI and Input PPI gives a better understanding of the price movements of output produced vis-a-vis inputs being used in an industry. It also explains how inflation experienced by producers on inputs is passed on to the output being produced,” the ministry said.
“Across groups, mineral oil (containing petroleum products), crude petroleum and natural gas, manufacture of chemicals and chemical products, and manufacture of basic metals have been major drivers of WPI inflation in April and May 2026,” the commerce ministry said.
The fuel and power segment, which now accounts for 14.1 per cent of the WPI by weight and also includes the crude petroleum and natural gas groups, witnessed a sharp rise in the inflation rate to 30.33 per cent in May, from 24.89 per cent in April 2026, reflecting the continued passthrough of elevated global energy prices.
Inflation in crude petroleum was 61.51 per cent in May, as against 56.31 per cent in the previous month.
The sharp rise in WPI inflation reflects the impact of the West Asia crisis and the effective blockade of the Strait of Hormuz, through which the majority of the crude oil is imported to India, and its spillover effect on food prices. (PTI)
