New Delhi, May 11: The economy got a twin boost today with industry clocking a rapid growth and inflation falling for the second week in a row.

The rate of inflation fell to 5.66 per cent for the week ended April 28 from 5.77 per cent a week ago. The index of industrial production rose 12.9 per cent in March, taking the cumulative growth during 2006-07 to 11.3 per cent.

Inflation and industrial growth are the two parameters that the Reserve Bank takes into account while determining interest rates.

The RBI, which wants to keep the inflation rate within 5 per cent, has already raised interest rates nine times since October 2004.

While inflation seems to be tempering, a continual surge in industrial production indicates that demand has not come down significantly. However, finance ministry officials feel the RBI may be approaching the end to its policy of raising rates.

“We feel with better farm output, the macro-economic situation has eased ... which means rates can now stabilise and there is no urgency to raise them,” senior officials said. Although inflation fell to 5.77 per cent, it was way above the year-ago figure of 3.9 per cent.

While prices of most food products declined, manufactured goods showed a rising trend. Prices of cereals declined by 0.2 per cent. Among cereals, wheat was cheaper by one per cent. Wheat production is estimated at 73.7 million tonnes in 2006-07 against 69.35mt in the previous year.