India’s wholesale inflation rises for 5th month in-a-row to 3.88%:Oil price rise drives surge in prices due to Iran war

Wholesale prices of goods in India have gone up again in March 2025, increasing by 3.88%, the government data showed. This marks the fifth month in a row that prices have climbed. The main reason for this increase is the rising cost of crude oil due to disruptions caused by the 6-week Iran war. Besides oil, the prices of manufactured goods and electricity have also contributed to the overall increase. The big jump in oil prices is mainly because of the ongoing problems in the West Asia. The tensions in the region, especially after the US-Israel attack on Iran, have created uncertainty in the global oil market. This uncertainty has led to a sharp increase in crude oil prices worldwide. Since the end of February, these prices have gone up by more than 50%. Looking at specific sectors, the cost of fuel and power increased by 1.05% in March. This is a significant change from February when these costs had actually decreased. The price of crude oil itself jumped by a huge 51.57% in March, showing how much the global situation affected India’s economy. To help ease the burden on common man, the Central Government had reduced taxes on petrol and diesel by around ₹10 per liter. This move was designed to prevent oil companies from passing on the full increase in oil prices to consumers. While the overall wholesale prices are rising, there’s some good news on the food front. The rate at which food prices are increasing has slowed down a bit. In March, food prices rose by 1.90%, which is less than the increase in February. The Reserve Bank of India (RBI), which is in charge of managing the country’s money supply, is keeping a close watch on these price increases. The RBI has decided to keep interest rates unchanged for now. The central bank is particularly focused on retail inflation, which is the price increase that consumers experience directly when buying goods and services. Retail inflation also increased in March, rising to 3.4%.