Mumbai: The annual rate of inflation based on the wholesale price index (WPI) declined to 6.63 per cent during the week ended February 10 from a record level of 6.73 per cent the previous week.

The fall in inflation was helped by a minor drop in the prices of food products, including vegetables, egg, mutton, poultry chicken, condiments, spices, fish-inland, sooji, gur, atta, sugar and some manufactured products.

Inflation at 6.63 per cent, however, is still the second highest this fiscal and way above the RBI's projection of 5-5.5 per cent for the year.

Wholesale price-based inflation stood at 3.81 per cent a year ago.

At tight money policy followed by the Reserve Bank of India (RBI) and tax cuts on fuel announced by the government seems to have pulled back surging prices a bit.

The fall in inflation is also came as soothing news to the UPA government, which is under pressure to beat back prices.

"My government will continue to take all necessary steps to ensure that poor are not adversely affected by inflation," President APJ Abdul Kalam said in his address to Parliament.

He, however, attributed the price rise to supply-demand mismatch in a growing economy.

The spike in inflation comes at a time when political parties are preparing for elections in the country's most populous state, Uttar Pradesh. Rising prices, if not checked, could top the opposition's campaign.

Last week, the government said it has taken measures to increase imports of several food products and cut import duties on some manufactured goods.