RBI Alone Can’t Curb Inflation

This refers to ‘RBI Likely to Increase Repo Rate by 25 bps’ (ET, Dec 16). RBI alone cannot control inflation since it is an indivisible economic phenomenon affected by growth and governance. Inflation is bound to rise because of 2014 general elections and repolling in Delhi. Elections mean exorbitant expenditure and use of black money. The RBI’s quantitative controls cannot control such resources. Also, inflation should be seen not only in terms of price rise but also in terms of decrease in quality and size of products and services.
- A L AGARWAL, New Delhi (ET)