According to official figures, the moderation was due to fall in prices of food items such potato, maize, sea fish, tea and imported edible oils, though other commodities such as coffee, fruits and vegetables, mutton and certain pulses like urad, moong and arhar became expensive during the week.

Commenting on the latest inflation figure, HDFC Bank Chief Economist Abheek Barua said price rise still remains a matter of concern.

"Inflation still remains a concern and could even touch 13 per cent by October once the control over steel products is eased besides possible increase in prices of cement, edible oil and cotton after monsoon," said Barua.

"RBI is expected to raise cash reserve ratio (CRR) rate by 25 basis points next week," he added. Meanwhile, a finance ministry statement said, "Out of 98 primary articles, the prices of 10 items have shown a decline, while 54 articles showed no increase." It noted that among the manufactured products, 219 articles out of total 318 commodities showed no increase in prices during the week, while nine items became cheaper.

Analysts said the high inflation rate, which is ruling at a 13-year high level, may force the Reserve Bank to further hike short-term lending rates (repo) as well as statutory deposit requirements (SDR) when it reviews the credit policy on July 29. RBI on June 24 already increased repo rate and CRR by 0.5 per cent each to counter inflation.

Possibly due to impact of floods in certain parts of the country, prices of vegetables went up by 4.8 per cent during the week, while pulses became dearer by 0.9 per cent and cotton by 1 per cent.

The manufacturered products, which have a weight of 63.75 per cent in the wholesale price index, rose by 0.05 per cent, while prices of fuel, power, light and lubricants with a weight of 14.23 per cent in the index, remained stable.

The Finance Ministry statement said the annual inflation for 30 essential commodities stood at 5.82 per cent for the week.

In the group of basic metals, alloys and metal products, the price of lead ingots increased by 6 per cent followed by 3 per cent rise in prices of zinc ingots.The prices of electrical equipment and systems also rose by 2 per cent followed by 1 per cent rise in prices of enamelled copper wires.

(PTI)