How do I loop over each line inside a file with ansible?

I managed to find an easy alternative:

- debug: msg="{{item}}"
  with_lines: cat files/branches.txt

Lets say you have a file like

item 1
item 2
item 3

And you want to install these items. Simply get the file contents to a variable using register. And use this variable for with_items. Make sure your file has one item per line.

---
- hosts: your-host
  remote_user: your-remote_user
  tasks:
  - name: get the file contents
    command: cat /path/to/your/file
    register: my_items
  - name: install these items
    pip: name:{{item}}
    with_items: my_items.stdout_lines

Latest Ansible recommends loop instead of with_something. It can be used in combination with lookup and splitlines(), as Ikar Pohorský pointed out:

- debug: msg="{{item}}"
  loop: "{{ lookup('file', 'files/branches.txt').splitlines() }}"

files/branches.txt should be relative to the playbook