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Riding on the back of falling onion and vegetable prices, the Wholesale Price Index-based food inflation remained in the negative zone for the third week in the row, at (-) 0.42 per cent for the week ended January 7.
It was above 16 per cent in the corresponding week last year and (-) 2.9 per cent in the previous week.
According to the official data released today, onion prices were down 75.42 per cent year-on-year during the week under review, while potato prices were down 23.84 per cent.
Prices of wheat also fell by 3.57 per cent. Overall vegetables were 45.81 per cent cheaper against the same period last year.
Protein-based items, however, became dearer. Pulses prices were 14.27 per cent up year-on-year during the week under review while milk grew dearer by 11.48 per cent. Egg, meat and fish prices were up 19.64 per cent year-on-year.
Fruits also became 10.03 per cent more expensive while cereal prices were up 2.26 per cent.
The annual rate of inflation stood at 2.47 per cent for the week ended January 7 against 0.51 per cent in the previous week.
Experts feel that the decline in food inflation, along with moderation in headline inflation during December 2011, will be a major incentive for the Reserve Bank to look at reversing the monetary policy.
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