New Delhi  - India's annual rate of inflation declined to a two-decade low of 0.44 per cent for the week that ended March 7, the federal Ministry of Commerce and Industry said Thursday.

The wholesale price-linked inflation declined by 1.99 percentage points from the previous weel's 2.43 per cent, fuelling expectations that the federal Reserve Bank of India (RBI) was to further cut interest rates to boost a slowing economy.

The wholesale index includes a range of basic food items and utilities.

The RBI on March 4 cut a key short-term lending rate to 5 per cent. The lending rate has been reduced by 400 basis points since October as part of the government's measures to boost lending by banks and spur consumer spending by reducing costs of borrowing.

The Indian economy has posted a 9-per-cent growth rate for three consecutive years, but the government revised the projection for the current fiscal year to 7.1 per cent.

India's financial year runs from April to March. (dpa)