Meanwhile, inflation for the week ended May 19 was revised upwards to 8.66 per cent, up from the 8.10 per cent reported earlier.
On a week-on-week basis, the WPI rose to 239 for the week ended July 12, from 238.7 in the previous week, prompting the finance ministry to say that inflation remains stable.
Despite the index going up, the inflation rate was lower because of the base effect, said Abheek Barua, chief economist, HDFC Bank. "In July, it will continue to enjoy the base effect, but in August, it will tend to push it up."
Barua pointed out that the latest numbers reinforce the fact that inflation is getting more broad-based.
During the week ended July 12, prices of items in the primary articles group in the index rose 0.6 per cent on account of higher prices of coffee (up 8 per cent), fruit and vegetables, urad and mutton (up 2 per cent each) and arhar, moong and jowar (up 1 per cent each).Items that saw a decline in prices include fish-marine (which fell 3 per cent), tea (which fell 2 per cent) and condiments, spices and maize (which fell 1 per cent each).
However, pressure points remain. The monsoon has performed poorly so far this year across much of India (the western parts are officially drought-hit).
The moratorium on hike in steel prices is also likely to end. In addition, cement prices have not been revised in the index despite increases at the ground level. The only relief is the slight decline in global crude oil prices.
With the data coming days before the Reserve Bank of India (RBI) is set to review the monetary policy on July 29, Barua expects a hike in the cash-reserve ratio by 25 basis points.
Shubhada Rao, chief economist, Yes Bank, does not expect any monetary policy action, but says the RBI will continue its hawkish stance.
"I would think it will wait and watch. We can expect some action between July and the next review in October", she said.
Commenting on the data, the finance ministry said prices of all the 19 articles in the fuel and power commodity group did not rise. It added that the annual inflation rate for 30 essential commodities continued to be range-bound, standing at 5.82 per cent for the week ended July 12.
