BofA-ML sees diesel price hike adding 120 bps to inflation

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PTI: Mumbai, Jan 20 2013, 20:03 IST

cent."

On the impact of the staggered diesel price hike, it said the move will add about 120 bps to FY14 inflation if crude remains at USD110 per barrel.

However, on the positive side, Gupta said, the price hike will help the government trim its oil subsidy by Rs 20,000 crore to Rs 67,300 crore (assuming a rupee value of 54 to the dollar).

Stating that the long tightening by the RBI has begun to turn counter-productive, he said "we cannot deny that RBI tightening is increasingly turning counter-productive in hurting growth rather than denting an inflation that is largely 'imported'."

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Diesel price hiked 45p per litre, petrol cheaper by 25p Maruti shares rise on receding fears of additional dutiesDon't invite wrath of the poor on volatile LPG cylinders quota, diesel price hikes, warns DMK's Karunanidhi Diesel price hike to add 120 bps to FY'14 inflation: Bank of America Merrill Lynch

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Nitin N Varia | 21-Jan-2013Reply | Forward

THE SHORT TERM INFLATION PAIN FOR A LONG TERM CURE IN THE ECONOMY AND PM FM HAVE DISPLAYED VISON WISDOM AND COURAGE TO GO FOR THIS CHEMOTHERAPHY OF THE ECONOMY.THEREFORE MR. MOILY ISSUES ULTIMATUM TO ROLL BACK ITS PERCEPTION ON PARTIAL DECONTROL INSPIRED BY NEW COMMANDER IN CHIEF HIS NEW BOSS MR RAHUL. OPPOSITION TO HEED TO ULTIMATUM AS THEY ARE NEITHER UNITED NOR UNNANIMOUS IN THEIR DIAGNOSIS OF THE ILLNESS IN THE ECONOMY AND IMMINENT THREAT OF RATING DOWN GRADE AND DEPRICIATING RUPEES. THEY ARE A CLUM OF TALKERS CLUB GIVING ENTERTAINMENT PROGRAMES ON MEDIA AND NOT ACTION PERCEPTION