Wholesale prices has fallen for the ninth consecutive month in July on the back of a decline in food and fuel prices, raising prospects of a cut in interest rates to give a push to growth.
This was the lowest level of the inflation based on wholesale price index (WPI) since 1976
Moreover, according to economists, it is the longest stretch of negative wholesale prices in the country since 1975.
WPI inflation was in negative zone for 12 months between July 1975 and June 1976.
Data released by the commerce ministry showed the wholesale inflation fell 4.05% in July compared to a decline of 2.40% for the previous month and 5.41% during the corresponding month of the previous year.
The sharp dip in WPI comes close on the heels of the significant moderation in retail inflation in July and together the two data sets have fuelled expectations of a cut in interest rates.