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According to government, inflation could go beyond 9% by the end of the month of March, with the effect of the decline in farm output becoming visible in this closing fiscal.
Chief Statistician of India and Secretary, Ministry of Statistics and Programme Implementation, Pronab Sen told “Unless something dramatic happens on agri prices, it (inflation) would probably be over 9 per cent”.
Wholesale Price Index, which entered the negative zone on account of global meltdown, has gained strength and increased by 7.3% in the month of December, 2009.
Replying to the question - if policy of easy money is intensifying inflation, Sen said “I don’t think that is really the case. There is large undisbursed balance with the banks. However, it could become a problem going forward.”
According to Sen, while introducing measures in its upcoming monetary policy review to be held on January 29 to check inflation, RBI will have to take into consideration several other factors in order to modify the main policy rates and ratios.
The central bank will need to look into policy rates and ratios in its monetary review, as the rising food inflation has turned into a worry, fueled primarily by high rates of essential food articles including potato, onion, other vegetables and pulses. Food inflation had sky-rocketed touching about 20% mark in 10-years in the first two-weeks of December but decreasing now and was standing at 16.81% for week concluding on January 9.
The Pioneer
January 22, 2010
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