This refers to the editorial "Still no room for RBI" (January 16). It is a great relief to know that consumer inflation
dropped from 11.2 per cent to 9.9 per cent, while wholesale inflation
declined from 7.5 per cent to 6.2 per cent. But the question that
lingers in the minds of policymakers is how far these figures are
sustainable, especially in the background of persisting political
instability, laxity in the pursuit of economic policies,
declining trend in industrial production and uncertainty over the
extension of adequate support for agricultural production. The Reserve
Bank of India cannot take policy decisions merely based on the current
trend - as it did in its last policy review. It would be better to wait
for some more future trends in the inflation index.
T.V.Gopalakrishnan Bangalore
(This letter appeared in Business Standard dated 17/1/2014).
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