Industrial production slipped to 1.7 per cent in January 2019 from 2.4 per cent in December 2018, manufacturing index was at 1.3 per cent per cent v/s 2.7 per cent month-on-month.
The report from the labour department on Tuesday also showed benign underlying inflation in February, which together with slowing economic growth, support the Federal Reserve's "patient" approach towards further interest rate increases in 2019.
Retail inflation rose to four-month high of 2.57 per cent in February, mainly driven by higher food prices.
The consumer inflation in January stood at 1.97 percent.
In the fuel and light category, the rate of price rise slowed to 1.24 per cent from 2.20 per cent in January.
Food price inflation for urban areas stood at 1.27 in February 2019 against (-) 0.96 per cent in January 2019 and 2.45per cent in February a year ago. Owners-equivalent rent, one of the categories created to track rental prices, rose 0.3 percent, as did rent of primary residence.
On Tuesday, February's CPI data will be released. The core inflation is expected to be steady around 5.4 percent last month as compared to 5.38 percent a month before. That index tends to run slightly below the Labour Department's CPI, and January figures are due March 29. The index was unchanged for three straight months. "We expect the inflation trend to remain firm near 2%".
A New York Fed survey of consumer expectations published on Monday showed a drop in inflation expectations in February. The consumer-price index follows the Labor Department's latest employment report, which showed average hourly earnings for private-sector workers rose 3.4% in February from a year earlier, a pace last matched in April 2009. "The weaker print can be traced to a drop in core goods prices, which fell 0.2%". They were held down by a 1.0 per cent decline in the price of prescription medication and a 0.7 per cent drop in the cost of hospital services.
In contrast, output of consumer non-durables rose by 3.8 per cent and that of consumer durables by 1.8 per cent. There were increases in the prices of motor vehicle insurance, airline fares, household furnishings and personal care products.