Inflation at fifteen months low of 3.36 percent, policy rates may ease

February 26th, 2009 - 7:19 pm ICT by admin  

New Delhi, Feb 26 (ANI): Inflation declined to a fifteen month low of 3.36 percent during the week ended February 14 against 3.92 percent in the previous week.

The 0.56 low was caused mainly due to fall in the prices of food articles like fruit and vegetables, pulses, and some manufactured items, raising hopes of cuts in the key policy rates by the RBI.

During the week, prices of food articles like maize fell by five percent, barley by three percent, and fruit and vegetables by two percent while eggs and spices declined by one percent each.

Among manufactured products, prices of mustard oil reduced by two percent, and sooji and coconut oil by one percent each.

Similarly, aluminium ingots got cheaper by 6 percent, and liquid chlorine by three percent.

Meanwhile, the government has assured that the RBI may ease money supply further.

Replying to the debate on the interim Budget in the Rajya Sabha on Wednesday, stand-in Finance Minister Pranab Mukherjee said, “I am fully concerned that increased public spending may put pressure on the government’s borrowing programme and overall credit off take in the economy.”

Mukherjee said: “There is, however, scope for appropriate compensatory monetary policy options, (which) I am sure will be exercised by the RBI at the right time.” (ANI)

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