Falling for the third straight month, retail inflation stood at 9.31 per cent in May due to easing of prices of edible oil and protein-based items, even as vegetable prices inched up sharply.
The Consumer Price Index (CPI) based inflation stood at 9.39 per cent in April. It was 10.39 per cent in March.
The overall food and beverages segment saw an inflation of 10.65 per cent in May, higher than 10.61 per cent in April.
The prices in the vegetables basket rose sharply to 9.78 per cent in May from 5.43 per cent in April, according to data released on Wednesday.
However, inflation in protein-based items - egg, meat and fish - declined to 12.52 per cent during the month, from 13.60 per cent in April. In oils and fats segment, it was 5.49 per cent, down from 7.52 per cent in April.
Among all the constituents that make the CPI, cereals recorded the highest inflation of 16.29 per cent in May.
Besides, inflation in pulses stood at 9.59 per cent and in sugar it was 9.21 per cent on an annual basis.
The rate of price rise in clothing and footwear segment stood at 9.72 per cent during the month.
In urban areas, retail inflation declined to 9.65 per cent in May from 9.73 per cent in April. The CPI for rural population fell to 8.98 per cent during the reported month from 9.16 per cent in April.
The data for wholesale price index-based inflation for May is expected on Friday. The WPI in April eased to over three-year low of 4.89 per cent.
The RBI would take into account the drop in retail inflation and the WPI numbers while formulating its mid-quarterly policy review, which is scheduled on June 17.
In order to accelerate economic growth, the Reserve Bank of India (RBI) had last month cut key interest rates by 0.25 per cent.
Meanwhile, another key economic indicator the index of industrial output (IIP) grew at 2 per cent in April.