High inflation may moderate in 2013

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Inflation may moderate in the new year on easing of supply constraints. (Reuters) Inflation may moderate in the new year on easing of supply constraints. (Reuters)
SummaryInflation may moderate in the new year on easing of supply constraints.

foods, edible oils, beverages and tobacco products.

Rise in food items has been a major source of high inflation mainly on account of persistent supply constraints in many protein items.

The government attributed persistent inflation to higher international crude prices, change in dietary pattern and revision in MSP on some of the essential commodities.

The government in the Budget undertook a number of measures like augmenting supply and improving storage and warehousing facility.

The Centre anticipates the RBI would adopt an accommodative monetary policy as inflationary pressures arising out of excess demand would ease.

The government expects inflation to moderate during the January-March quarter and March-end at 6.8-7 per cent.

Although it would still remain above the RBI's comfort level of 5-6 per cent, a rate cut is on the anvil as RBI is expected to work towards boosting growth.

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