Inflation will ease after 3-4 months: Rangarajan

May 23rd, 2008 - 8:37 pm ICT by admin  

New Delhi, May 23 (IANS) India’s inflation rate will ease only after three-four months and could eventually come down to around 5.5 percent, says the Prime Minister’s Economic Advisory Council. “As it stands now, for another 3-4 months inflation will remain high even though it would show a tendency to decline at around 6 percent,” Council Chairman C. Rangarajan told reporters here on the margins of a conference on centre-state finances.

“Inflation may even reach 5.5 percent by the end of this fiscal,” Rangarajan, a former governor of the Reserve Bank of India, added.

His remarks came against the backdrop of India’s annual rate of inflation based on wholesale prices easing slightly to 8.22 percent for the week ended May 10 from 8.33 percent for the week before.

The noted economist also said that industrial production, too, will pick up eventually and that the slow growth of a mere three percent in March was a “blip” without any lon-term significance.

“We still think the overall growth rate during 2008-09 could be around close to 8 percent. Industrial production will be a little higher than that,” he said.

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