A Reuters poll of 45 economists had forecast a rate of 7%.

Food inflation, which accounts for nearly half of the overall basket, was up 9.94% in August compared with a rise of 11.51% in July.

COMMENTARY:

UPASNA BHARDWAJ, CHIEF ECONOMIST, KOTAK MAHINDRA BANK, MUMBAI

"August retail inflation came in line with our expectations, led largely by moderation in vegetable prices and easing core inflation. These figures should provide some breathing space to the MPC (monetary policy committee)."

"However, we continue to remain watchful on the cereals, pulses and rising oil prices. Overall, today's readings reinforce our view of a prolonged policy-rate pause with a clear caution on any risks arising for generalised inflation."

(Compiled by Nishit Navin in Bengaluru; Editing by Savio D'Souza)