Yash Bank Forecasts Wholesale Inflation Near 9%, Retail at 4.8% for 2024

In a detailed briefing, Yash Bank highlighted that India’s wholesale price index (WPI) is likely to stay around the 9 percent mark for the current financial year, while the consumer price index (CPI) is expected to average 4.8 percent. The bank cautions that the disparity between wholesale and retail numbers means the transmission of price hikes from producers to consumers cannot be ruled out.

The RBI, meanwhile, remains in a "wait and watch" mode on repo rate decisions. The central bank appears to be downplaying supply‑side inflationary forces, even as the ongoing Middle East tension looms as a potential risk to manufacturing input costs.

July’s headline WPI came in at 9.8 percent year‑on‑year, matching the 9.75 percent market forecast and easing marginally from June’s 9.9 percent. The note points out that input‑price pressures have eased, primarily because petroleum and chemical cost indices have softened for a second month running.

Despite the respite on input costs, the report warns that the broader uncertainty surrounding the West‑Asia crisis could keep the manufacturing sector vulnerable. Global commodity prices have been largely flat in July, and analysts expect the same stability in August.

Given these mixed signals, Yash Bank advises the RBI to continue its cautious policy stance, avoiding any abrupt rate adjustments until there is clearer evidence that wholesale price movements are filtering through to retail inflation.