Indian headline inflation declined to 9.22 percent from 9.44 percent in June, said a statement by Indian Ministry of Commerce and Industry.
The provisional inflation number in July is obviously lower than market expectation of near ten percent but could be significantly revised upward later.
Inflation with primary articles decreased to 11.3 percent in July lower food prices like fruits and milk and non-food articles like fibres and minerals.
The fuel and power sector recorded inflation of 12.04 percent in July from 12.85 percent due to higher basis in last year.
The manufactured products sector had 7.49 percent of price growth from 7.43 percent in previous month, showing continuous pressure of price increase in the heavyweight sector.
Additionally, the inflation number in May was adjusted to 9.56 percent from 9.06 percent on provisional basis.
Indian Prime Minister Manmohan Singh Monday said, "I wish to assure you today that we are continuously monitoring the situation to find out what new steps can be taken to arrest rising prices. Finding a solution to this problem will be our top-most priority in the coming months."
After raising interest rates for 11 times since last March, Indian central bank now in supposed to be at the junction of halting monetary tightening moves to protect growth.