Wholesale price-based inflation (WPI) fell to a three-month low of 1.89 per cent in November, driven by cheaper food items, prompting economists to predict a 0.25 per cent interest rate cut by the Reserve Bank of India (RBI) in its February policy review.

WPI was 2.36 per cent in October 2024 compared with 0.39 per cent in November last year. In August 2024, it stood at 1.25 per cent.

Data showed that inflation in food items eased to 8.63 per cent in November from 13.54 per cent in October, led by a significant drop in vegetable inflation, which fell to 28.57 per cent from 63.04 per cent in October.

However, potato inflation remained high at 82.79 per cent, while onion inflation sharply declined to 2.85 per cent in November.

The fuel and power category saw a deflation of 5.83 per cent in November, slightly higher than the 5.79 per cent deflation in October.

Inflation in manufactured items rose to 2 per cent in November from 1.50 per cent in October.

Barclays noted in a research report that wholesale price inflation softened in November due to lower primary food inflation, which offset higher inflation in manufactured products.

"Global prices are up 0.7 per cent in December to date and are likely to push December wholesale price index-based inflation higher," Barclays said.