India’s wholesale inflation climbed to 11.39 per cent in September 2026 from 9.92 per cent in August, with a sharp rise in fuel and power prices emerging as a major driver of price pressures across the economy.
Inflation in the fuel and power basket accelerated to 25.85 per cent in September from 22.93 per cent in August, reflecting elevated energy costs amid the West Asia conflict and disruption to supplies through the Strait of Hormuz.
The Commerce and Industry Ministry identified mineral oils, including petroleum products, crude petroleum and natural gas, and coal and lignite among the major contributors to wholesale inflation during the month.
The escalation in energy prices has wider implications for the economy because fuel and power costs feed into transportation, manufacturing and industrial input costs. Manufactured-product inflation reached a series high of 9.76 per cent in September, up from 8.37 per cent in August.
Energy Shock Spills Into Wider Inflation
The disruption to energy flows through the Strait of Hormuz has pushed up global crude oil prices and fertiliser costs. India’s dependence on imported crude leaves domestic prices particularly exposed to prolonged disruptions in global energy markets.
The impact is also visible beyond the energy basket. Food index inflation increased to 8.66 per cent in September from 7.05 per cent in August, while basic metals, chemicals and chemical products, textiles, rubber and plastic products and electrical equipment were among the categories contributing to higher WPI inflation.
The latest data underline how the external energy shock is increasingly feeding into domestic production and commodity costs. Retail inflation also rose to a 23-month high of 5.54 per cent in September from 4.83 per cent in August, driven primarily by higher food prices. Against the backdrop of rising inflation, the Reserve Bank of India’s Monetary Policy Committee last week increased the repo rate by 25 basis points to 5.50 per cent.