‘Inflation will drop to 8 to 9 percent by next March’

August 4th, 2008 - 9:45 pm ICT by IANS  

New Delhi, Aug 4 (IANS) Against popular perception that double-digit inflation will persist for more than a year, Prime Minister’s Economic Advisory Council (EAC) chairman C. Rangarajan Monday said inflation could ease down to 8-9 percent by March 2009. “Perhaps to look at an inflation rate of 8-9 per cent will be a difficult thing in the current scenario, but probably we will do it by March 2009,” Rangarajan told reporters on the sidelines of a book launch here Monday.

He, however, said moderation in inflation would be possible only if global crude oil prices did not rise above the current level.

The international crude oil is being traded at around $123 a barrel in contrast to $147 per barrel July 11. A barrel in quantity is equivalent to 159 litres.

Inflation touched an all-time high of 11.98 percent for the week ended July 19.

Rangarajan said the GDP growth rate of the country is likely to slow down and will not be able to touch 9 percent. He attributed the slow down to “various external and domestic factors”.

“Nevertheless, I think we can still hope to have GDP growth of economy between 7.5 to 8 percent,” he said.

The EAC is expected to submit its report on Outlook of Economy for 2008-09 next week.

The council had projected GDP growth of 8.5 percent for 2008-09 in early 2208 when the inflation situation was not as grim.

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