The report states that it is projected to average above 1.5 per cent in the fourth quarter of the current financial year (Q4FY26)
Emphasising that the wholesale price index (WPI) is expected to have bottomed out in October 2025, Icra has stated that it is likely to revert to an inflation of around 0.5 per cent in December 2025. Similarly, the report noted that it is projected to average above 1.5 per cent in the fourth quarter of the current financial year (Q4FY26).
The report added that the WPI inflation is expected to be pushed up by multiple factors like narrowing deflation in the food segment, uptick in global commodity price inflation, as well as depreciation in the USD/Indian Rupee.
The WPI year-on-year (YoY) deflation narrowed faster than expected to 0.3 per cent in November 2025 from 1.2 per cent seen in the prior month. Even as an elevated base for primary food articles kept the print muted at – 4.2 per cent in November 2025, the extent of deflation almost halved from 8.3 per cent seen in October 2025, pushing up the headline print by as much as around 89 basis points (bps) between these months.
Deflation in fuel and power segment slowed as the index fell by – 2.3 per cent in November 2025, after declining by – 4 per cent in November 2024, and was even higher than October 2025 (-2.6 per cent). Compared to the previous year, the slowdown in pace of decline was broad-based. Inflation index for mineral oil segment registered – 3.4 per cent fall compared with – 5.2 per cent dip last year in November 2024, as per a report by Bank of Baroda.
Core inflation remains higher at 1.5 per cent in November 2025, up from 0.6 per cent last year (November 2024). It is unchanged from last month (October 2025). Manufactured product inflation however eased, to 1.3 per cent in November 2025 from 2.1 per cent last year during the same period. It was also lower than last month’s (October 2025) 1.5 per cent print, the report added.
