New Delhi: For the week ended August 18, 2007, inflation based on the wholesale price index (WPI) descended to 3.94 per cent from 4.10 per cent in the previous week. During the last week, the annual inflation stood at 4.10%. Last time, such low levels were seen in April 2006.

It would be the 11th sequential week that inflation rate rested under 5%, the central bank’s mark for the existing fiscal. The central bank held its temporary lending rate steady at the monetary plan evaluation in July, as anticipated, after raising it five folds since mid 2006.

The RBI has also raised the ceiling on market stabilization bonds, used to assimilate funds yielded by its currency intervention, by one-third to Rs 1.5 trillion.

Annual inflation jumped to over two-year high of 6.69% in late January, dampened to 4.05% in early August after the RBI stiffened policy and the administration slash duties on a slew of accomodities to chill prices.