The wholesale price index (WPI) inflation slowed to 4.73 percent in January from 4.95% recorded in December.
The decline in the rate of inflation in January is primarily contributed by mineral oils, chemicals & chemical products, textiles, crude petroleum & natural gas among other items.
The food index inflation climbed to 2.95 per cent in January from December's 0.65 percent.
The number comes a day after the government released the headline retail inflation numbers.
India's headline retail inflation rate jumped to a three-month high of 6.52 percent in January from December's one-year low of 5.72 percent.
The WPI inflation in January continued its downward trajectory and has printed at a two-year low. however, the food index comprising 'Food Articles' from Primary Articles group and 'Food Product' from Manufactured Products group surged to 2.95 percent from 0.65 percent in December.
Among food items, cereals and milk prices trended upwards. Cereal inflation hardened to 15.46 percent from December's 14 percent while milk price inflation surged to 8.96 percent from December's 6.99 percent.
The RBI, which tracks CPI for arriving at the monetary policy decisions, is likely to go for one more rate hike after a 25 basis points hike in its February policy. The repo rate currently stands at 6.5 percent.
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