Inflation fell marginally to 11.80 per cent for the week ended September 27 on account of declining prices of food items, including cereals and pulses.
The annual rate of inflation, measured by the wholesale price index, declined to 11.80 per cent from 11.99 per cent a week ago.
The prices of fruits and vegetables during the reporting week declined by one per cent, cereals and pulses by 0.1 per cent and groundnut by two per cent.
Among the food articles, milk became expensive by one per cent, while the prices of imported edible oil soared by five per cent.
In the manufactured goods category, the pipes and tubes became cheaper by two per cent, while the prices of iron and steel items and cement remained unchanged.
"The price moderation is more than expected. This is due to seasonal effect and reasonably good harvest," said Abheek Barua, chief economist, HDFC Bank.
The inflation, which has remained above 12 per cent for several weeks came down to 11.99 per cent for the week ded September 20 and declined further in the reporting week.