WordPress .htaccess file gives issues with subdirectory

I have a WordPress installation in the root and a subdirectory, which contains a index.html file.

This file doesn’t give me proper display as what it is supposed to when I access it. But when I rename the .htaccess file on root (WordPress main installation), this index file in the subdirectory shows up as it is supposed to. But this makes WordPress non functional.

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I have no .htaccess file in my subfolder.

These are the contents of my .htaccess:

## EXPIRES CACHING ##
<IfModule mod_expires.c>
ExpiresActive On
ExpiresByType image/jpg "access 1 year"
ExpiresByType image/jpeg "access 1 year"
ExpiresByType image/gif "access 1 year"
ExpiresByType image/png "access 1 year"
ExpiresByType text/css "access 1 month"
ExpiresByType application/pdf "access 1 month"
ExpiresByType text/x-javascript "access 1 month"
ExpiresByType application/x-shockwave-flash "access 1 month"
ExpiresByType image/x-icon "access 1 year"
ExpiresDefault "access 2 days"
</IfModule>
## EXPIRES CACHING ##
# BEGIN WordPress
<IfModule mod_rewrite.c>
RewriteEngine On
RewriteBase /
RewriteRule ^index.php$ - [L]
RewriteCond %{REQUEST_FILENAME} !-f
RewriteCond %{REQUEST_FILENAME} !-d
RewriteRule . /index.php [L]
</IfModule>

# END WordPress

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