Inflation dips further to 3.36 per cent

Continuing its southward journey, inflation fell further to 3.36 per cent for the week ended February 14, from 3.92 per cent in the previous week.

It was slightly above a median forecast in a Reuters poll of analysts of 3.31 percent. The annual inflation rate was 5.66 percent during the corresponding week of the previous year.

RBI expected annual inflation to be below 3 per cent by March 31, the end of the 2008/09 fiscal year, with some analysts predicting it will be even lower.

The inflation rate fell from above 5 per cent in the last week of January after India cut its state-set retail fuel prices by up to 11 per cent.

Economists expect the central bank to cut interest rates again in the near term, prompted by falling inflation and slowing economic growth in Asia's third-largest economy