Inflation in India likely to be 6.5% this fiscal

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mrinal ali hazarika

31 October, 2009

The Reserve Bank of India (RBI) expects the annual inflation rate in India to be 6.5 per cent by next March. Prior to this the central bank had predicted the inflation rate at 5 per cent.

INFLATION IS likely to rise to 6.5 per cent this fiscal. The Reserve Bank of India (RBI) expects the annual inflation rate in India to be 6.5 per cent by next March.

"Keeping in view the global trend in commodity prices and the domestic demand-supply balance, the baseline projection for wholesale price index (WPI) inflation at the end of March 2010 is placed at 6.5 per cent with an upside bias," said the RBI Governor D Subbarao while reviewing the monetary policy for this fiscal. Moreover he added that "The baseline projection for gross domestic product (GDP) growth for 2009-10 is placed at 6 per cent with an upside bias".

Prior to this the central bank had predicted the inflation rate at 5 per cent. Expressing the plans of the RBI regarding the inflation he said, "The conduct of monetary policy will continue to condition and contain the perception of inflation in the range of 4-4.5 per cent. This will be in line with the medium-term objective of 3 per cent inflation consistent with India's broader integration with the global economy."