The annual Wholesale Price Index-based inflation rate dropped to 11.8% for the week ended September 27. It was at 11.99% in the previous week. The economists are expecting further decrease in inflation rate in coming month due to good supply of food stuff and dearer liquidity. The prices of crude oil are also at the lowest level of $85/barrel and may decrease further. The agriculture related products also contributed in lowering the inflation rate.

The reserve bank chairman, Subdha Rao said the fall in crude oil is a good signal and the bank would take more steps to moderate the inflation level. The finance ministry sources also expected decrease in inflation rate in the coming times.

Inflation rate is decreased following drop in the prices of primary articles for the respective week. The index of food articles did not change but non food items witnessed certain drop in prices. The index of fuel, power, light and lubricant segment also remains unchanged. This segment has a weight age of 14.2 per cent in the WPI. The manufactured products also declined to 10.3% for the week ended September 27.