Chief Economic Advisor (CEA) Arvind Subramanian said he does not see oil prices going beyond $80 to $85, a price which will help India manage its macro economy reasonably.
“… yes oil prices could go up, but given the fundamental changes (in the market), the likelihood of it (oil price) going up to anywhere beyond 80 or 85 dollars I (think) relatively (should be) ignored and as long as oil prices stay, don’t go beyond that I think we can manage our macro economy reasonably,” he said in an interaction conducted by Bangalore International Centre and Indian Institute for Human Settlements here.
He replied to the question after delivering a talk on Economic Survey – Taking stock of the Indian Academy.
Subramanian said there has been fundamental shifts in the market and thought demand has come down. “On oil – is that there has been fundamental shifts in the market. I think demand has come down,” he said.
Replying to a question, Subramanian said going by the May and June figures he thought gold prices have stabilised.
“… if you see May and June figures I think gold has stabilised,” he said.
Subramanian said some time back the demand for gold went up because of rising gold prices and high inflation, but in the last few months there has been a decline in gold prices.
Demand, remember, went up for two reasons – gold started rising because it was seen as an investment and second, inflation was very high … what you see in last few months is the decline in gold,” he added.