Finance minister Pranab Mukherjee on Monday attributed the current inflationary conditions in the economy to supply side constraints. Speaking to reporters in New Delhi, Mr Mukherjee expressed hope that inflation in the country would come down by December adding that the Centre was taking supply side measures to tackle price rise. Earlier on October 19, Prime Minister Manmohan Singh had expressed confidence that inflation would come down by the year end and the country will have high growth of 8-8.5 per cent despite adverse global economic situation. Food inflation shot up to 11.43 per cent for the week - ended on October 15 - on the back of costlier vegetables, fruits, milk and protein-based items. Since March 2010, the RBI has raised repo rate by a total of 3.75 per cent to 8.50 percent but its effect is yet to be seen on inflation figures which have remained above expectations. Instead, the economy has lost its growth momentum with key data suggesting a slowdown in the medium term. Taming inflation has remained a concern for the central bank and the Centre. Inflation in September fell marginally to 9.72 per cent from 9.78 per cent a month ago. Headline inflation has remained above 9 per cent levels for the 10th straight month on supply side bottlenecks, high commodity and fuel prices.
NDTV Profit
