According to government data, the Wholesale Price Index (WPI) based inflation rate has increased for the third consecutive month. In January 2026 it was 1.81 percent. This increase was due to month-on-month increase in prices of food items, non-food items and manufactured products. WPI inflation in January last year was 2.51 percent, while in December 2025 it was recorded at 0.83 percent.
main reason for inflation rate
According to the statement of the Industry Ministry, the main reason for the positive inflation rate in January 2026 was the increase in prices of basic metals, other manufacturing, non-food items, food items and textiles.
- According to World Food Technology Commission (WPI) data, food inflation stood at 1.55 per cent in January, while it was 0.43 per cent in December.
- In case of vegetables, inflation stood at 6.78 per cent in January, while it was 3.50 per cent in December.
- In case of manufactured products, World Product Index (WPI) inflation rose marginally to 2.86 per cent as against 1.82 per cent in December.
- Inflation in the non-food items category increased to 7.58 percent in January, compared to 2.95 percent in December.
- Negative inflation, or deflation, in the fuel and power sectors continued at 4.01 per cent in January, compared to 2.31 per cent in December.
- According to data released last week, the country’s retail inflation rose marginally to 2.75 percent in January.
- The Reserve Bank of India (RBI) has reduced the policy interest rates by 1.25 percentage points in the current financial year as inflation remains low.
- RBI sets benchmark interest rates primarily by keeping an eye on retail inflation. Earlier this month, the RBI kept key policy interest rates unchanged at 5.25 per cent.
