Sunday, October 23, 2011
The annual rate of inflation in the food space increased in the second week of October while inflation in the fuel group also edged up, data released by the Government showed on Thursday. Annual inflation in the Food Articles group rose to 10.60% in the week ended October 8 from 9.32% in the preceding week, the Commerce & Industry Ministry said in a statement. It was at 15.72% in the corresponding period of last year. Inflation in the Primary Articles group increased to 11.18% in the week under review, from 10.60% in the week ended October 1, according to the Commerce Ministry statement. It was at 19.03% in the year-ago period. Inflation in the Fuel & Power group rose to 15.17% in the week ended October 8 from 15.10% in the previous week, the Government data showed. It was at 11.14% in the comparable week of the previous year. Inflation in the Non-Food Articles space declined to 8.51% in the week under review from 9.59% in the previous week, the Government data showed today. It was at 27.17% in the same period a year
The Indian economy will grow at less than 8% rate in the current fiscal year due to a sharp slowdown in the industrial production, Chairman of the Prime Minister’s Economic Advisory Council (PMEAC) Dr. C. Rangarajan said on Thursday. The PMEAC, which provides economic forecasts twice a year, has predicted a growth of 8.2% for the fiscal year ending in March 2012. Finance Minister Pranab Mukherjee on Wednesday said that India's economy will grow less than 8% in the current fiscal year. Dr. Rangarajan said that the Government needs to use both fiscal and monetary tools to rein in inflation to maintain high growth. "When inflation is remaining at the level which is way above the comfort level of central bank, therefore in that situation it becomes absolutely essential for the central bank to act," Rangarajan said at a conference in New Delhi.
After a choppy week, Indian markets could witness some more volatility and uncertainty as participants brace for the outcome of the much-hyped eurozone summit besides the RBI’s policy meeting. Both these key events will have a definite bearing on the sentiment, as will the F&O expiry and corporate earnings.
Next week will be a truncated one due to Diwali holidays. Of course, there will be the special Mahurat session on Diwali.
India’s GDP growth in the current fiscal year will be lower than the Government’s earlier projection owing to hardening spiraling inflation, interest rates and global turmoil, Finance Minister Pranab Mukherjee said on Wednesday. "Most of us are expecting India's growth to go down below 8 percent. This is disappointing," Mukherjee told a news conference. "But if we can, we must not lose perspective of the global situation. There is slowdown all over the world."