India's wholesale price index (WPI) rose a higher-than-expected 7.55% in August from a year earlier, mainly driven by higher food prices due to deficient monsoon, government data showed on Friday.
The data comes ahead of a policy meeting at the Reserve Bank of India on Monday where the bank is expected to leave interest rates on hold as it grapples with inflation.
However, a move by the government late on Thursday to raise subsidised diesel prices for the first time in 15 months was seen as increasing the odds for the first rate cut since April.
Analysts on average had expected an annual WPI rise of 6.95%, a Reuters poll showed.
The annual reading for June was revised upward to 7.58% from 7.25% earlier. July's inflation was provisionally put at 6.87%.