The wholesale price index has fallen sharply to a nine-month low of 6.84 per cent for the week ending 6 December 2008, below the previous week's 8 per cent, against the backdrop of falling fuel prices and expectations of a fresh economic stimulus in the days ahead.

The Stock market cheered the lower inflation rates and the benchmark Sensex zoomed past the 10,000-mark closing  361014 points higher at 10,076. The nifty crossed the 3000-mark and rose by 71 points to 3060.75.

The government reduced the per litre prices of petrol and diesel by Rs5 and Rs2 respectively with effect from 6 December in the wake of falling prices of crude oil in the international market (See: Petrol, diesel prices cut)

The inflation rate fell to the lowest since early March 2008 as demand slowed amid the global economic meltdown and a drop in crude oil costs led the government to cut retail fuel prices.

Bonds rose amid speculation that slowing inflation will give the central bank room to add to three interest-rate cuts in the past two months as growth falters. India's monetary policy should have been ''more aggressive'' to counter the impact of the global financial crisis, Arvind Virmani, the finance ministry's chief economic adviser said yesterday.

The inflation rate was 6.21 per cent in the week ended 1 March 2008. The rate during the corresponding period last year was 3.84 per cent

Primary articles (Weight 22.02per cent) 
The index for this major group declined by 0.4 per cent to 249.0 (Provisional) from 249.9  (Provisional) for the previous week. The groups and items for which the index showed variations during the week are as follows: 

The index for 'food articles' group declined by 0.5 per cent to 243.4 (Provisional) from 244.7  (Provisional) for the previous week due to lower prices of moong (4per cent), urad (3per cent), fruits & vegetables  and tea (2per cent each) and barley (1per cent). 

The index for  'non-food articles' group rose by 0.1 per cent to 234.6 (Provisional) from 234.4 (Provisional) for the previous week due to higher prices of fodder (2per cent) and groundnut seed , gingelly seed and raw cotton (1per cent each).  However, the prices of niger seed   (18per cent),  raw rubber (4per cent) and raw wool (1per cent) declined. 

The annual rate of inflation, calculated on point-to-point basis, for 'Primary Articles' stood at 11.81 per cent (provisional) for the week ended 06 / 12 / 2008 as compared to 11.66 per cent (Provisional) in the previous week.  It was 4.55 per cent as on 08 / 12 / 2007 i.e. a year ago. 

The annual rate of inflation for 'Food Articles' stood at 10.19 per cent (provisional) for the week ended 06 / 12 / 2008 as compared to 10.52 per cent (Provisional) in the previous week.  It was 2.51 per cent as on 08/12/2007 i.e. a year ago.

Fuel, power, light & lubricants (Weight 14.23per cent)
The index for this major group declined by 3.7 per cent to 332.1 (Provisional) from 345.0  (Provisional) for the previous week due to lower prices of naphtha (23per cent), furnace oil (15per cent), bitumen (11per cent), petrol (10per cent), aviation turbine fuel (7per cent), high speed diesel oil (6per cent), light diesel oil (5per cent) and lubricants (4per cent).

Manufactured products (Weight 63.75per cent)
The index for this major group declined by 0.3 per cent to 202.4 (provisional) from 203.1  (provisional) for the previous week. The groups and items for which the index showed variations during the week are as follows:-

The index for 'food products' group rose by 0.2 per cent to 199.5 (provisional) from 199.2 (provisional) for the previous week due to higher prices of gur and bran (all kinds)  (4 per cent each), atta (2 per cent) and cotton seed oil, groundnut oil and ghee (1 per cent each).  However, the prices of rice bran oil (4 per cent), coconut oil (3 per cent), imported edible oil (2per cent) and sooji (rawa) (1per cent) declined.

The index for 'textiles' group declined by 0.1 per cent to 141.5 (Provisional) from 141.7 (Provisional) for the previous week due to lower prices of texturised yarn (5per cent).

The index for 'chemicals & chemical products' group declined by 0.6 per cent to 222.5 (provisional) from 223.8 (provisional) for the previous week due to lower prices of benzene (41 per cent), purified terephthalic acid (pta) (24 per cent), bopp film (11 per cent) and liquid chlorine (1 per cent).  However,  the prices of pvc. resins (3 per cent) moved up.

The index for 'basic metals alloys and metal products' group declined by 1.1 per cent to 280.4 (Provisional) from 283.6 (Provisional) for the previous week due to lower prices of basic pig iron and foundary pig iron (7per cent each), joist & rolls and oromild steel & tensile plates (6per cent each), wire (all kinds) (5per cent), zinc (4per cent), skelps, cr coils and zinc ingots (3per cent each), cr sheets and angles, channels & sections (2per cent each) and steel sheets, plates & strips and other iron steel (1per cent each).  However, the prices of ms bars & rounds (3per cent) moved up.

The index for 'Transport Equipment & Parts' group declined by 0.5 per cent to 176.5 (Provisional) from 177.3 (Provisional) for the previous week due to lower prices of car chassis (assembled) (3per cent).