Consumer inflation fell more-than-expected to a 25-month low of 8.10 per cent in February on moderating food prices. Consumer inflation stood at 8.79 per cent in January.
Retail inflation was expected to moderate to 8.3 per cent in February, according to an NDTV poll of analysts.
The price rise in food prices fell to 8.57 per cent in February, from 9.9 per cent in January.
The recent trend of a decline in food prices however could be temporary as hail and heavy rains in the past two weeks have damaged crops. This is likely to keep core retail inflation elevated. Core inflation is calculated by excluding certain volatile items like food and fuel products.
Core consumer price index was estimated to have risen around 7.9 per cent in February from a year earlier, easing from an 8.1 per cent advance in January, according to a Reuters snap survey of four dealers and economists.
Core inflation has been stuck at around 8 per cent for the past few months, a level Reserve Bank of India (RBI) chief Raghuram Rajan deems uncomfortably high.
In an attempt to quell price pressures, the RBI has raised interest rates three times since September, even though economic growth is languishing at around a decade-low of 4.5 per cent. The central bank is due to review rates on April 1.
'(With Agency inputs)
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