Retail inflation declined to a three-month low of 5.1 per cent in January, mainly due to subdued prices of vegetables, fruits and other food items, according to government data released on Monday.

The fall indicates that retail inflation is inching towards the Reserve Bank of India’s (RBI) comfort level of 4 per cent.

The Consumer Price Index (CPI)-based inflation was on the rise for two straight months after touching a trough of 4.9 per cent in October 2023. In December, it stood at 5.69 per cent.

In January, inflation in the food basket eased to 8.3 per cent from 9.53 per cent in the preceding month. It was at 6 per cent in January 2023, according to data released by the National Statistical Office (NSO).

Food inflation was lower in rural areas at 7.91 per cent compared to 9.02 per cent in the urban centres of the country.

The latest data showed that inflation in oils and fats, pulses and products, spices, fruits and vegetables segments was lower in January 2024 compared to that in December 2023.

However, inflation was marginally higher in the fuel and light, clothing and footwear, cereals and products, meat and fish and eggs segments on a month-on-month basis.

According to the data, inflation was more than the national average of 5.1 per cent in Assam, Gujarat, Haryana, Karnataka, Maharashtra, Odisha, Punjab, Rajasthan, Telangana, and Uttar Pradesh.

The lowest reltail inflation in January this year was in Delhi at 2.56 per cent.

Aditi Nayar, the chief economist of rating agency ICRA, said that while rabi sowing had caught up with last year’s level, reservoir storage remained well below the year-ago levels in most regions, continuing to imbue caution in terms of the outlook for the rabi harvest.