The annual rate of inflation, measured by the wholesale price index, declined to 11.80 per cent from 11.99 per cent a week ago. During the reporting week, prices of fruits and vegetables declined by one per cent, cereals and pulses by 0.1 per cent and groundnut by two per cent. Among the food articles, milk became expensive by one percent, while the prices of imported edible oil soared by five percent. In the manufactured goods category, pipes and tubes became cheaper by two per cent, while the prices of iron and steel items and cement remained unchanged.
Inflation, which remained above 12 per cent for several weeks came down to 11.99 per cent for the week ended September 20 and declined further in the reporting week.
In India inflation is calculated on the wholesale price index because it covers a higher number of products and is released weekly.
Earlier in the day, the RBI stepped in to hand-hold the markets with a cash reserve ratio (CRR) cut, but the Index of Industrial Production (IIP) figures dampened the spirits again. The government then decided to announce the inflation figures, earlier than expected.