Food inflation witnessed a sharp moderation to a 39-month low of 6.60 per cent during the week ended November 26 as prices of kitchen essentials like onions, potatoes and wheat declined, providing much-needed relief to the common man as well as the government.

This is the lowest rate of food inflation, as measured by the Wholesale Price Index (WPI), since August 9, 2008, when it stood at 6.19 per cent. Food inflation stood at 8 per cent in the previous week ended November 19.

Experts said the moderation in the rate of price rise of food items will have a sobering effect on the Reserve Bank, which is scheduled to conduct its next mid-quarterly credit policy review on December 16.

According to data released today, onions became cheaper by 39.20 per cent year-on-year during the week under review, while potato prices were down by 15.75 per cent. Prices of wheat also fell by 4.70 per cent.

Overall, vegetables became cheaper by 1.25 per cent, a big relief after double-digit inflation in vegetable prices during the months of September and October.

"Food inflation is expected to moderate further in December, 2011, particularly on account of the base effect," ICRA Economist Aditi Nayar said.

Food inflation was near 9 per cent in the same period last year, signifying a high base.

"Notwithstanding the moderating economic growth impulses, we expect the RBI to keep the repo rate unchanged in the upcoming policy review, to continue to restrain inflationary expectations," Nayar said.

Experts attributed the decline in inflation to the good monsoon and plentiful kharif harvest.

"Farm output has been good and food inflation is expected to remain at a moderate rate for some time," Crisil Chief Economist D K Joshi said.

"Though we have to wait and see how the manufactured products inflation fares in November, the moderation in food inflation will at least ensure that the RBI maintains the interest rate at current levels," he added.

However, protein-based items continued to grow more expensive on an annual basis, as per the latest data.

Pulses became 13 per cent costlier during the week under review, while milk grew dearer by 11.02 per cent and eggs, meat and fish by 10.04 per cent.

Fruits also became 10.72 per cent more expensive on an annual basis, while cereal prices were up by 1.68 per cent.

"There are structural factors behind the high inflation of protein-based items. While consumption of such products has increased, production has not kept pace with that," Joshi said.

Inflation in the overall primary articles category stood at 6.92 per cent during the week ended November 26, as against 7.74 per cent in the previous week.

Inflation in the non-food segment, which includes fibres, oilseeds and minerals, was recorded at 1.37 per cent during the week under review, as against 2.14 per cent in the week ended November 19.

Fuel and power inflation stood at 15.53 per cent during the week ended November 26, the same as in the previous week.