India?s food inflation may stay in double digits in next two to three months and keep headline inflation above 10% until September, which will tempt central bank to raise interest rates in July policy, a top policy advisor said on Thursday. M Govinda Rao, a member of Prime Minister Manmohan Singh?s economic advisory council, also said the empowered group of ministers has to strike a balance between inflation and fiscal deficit while deciding on fuel price deregulation. ?There is a need to keep a continuous tab on the food inflation. The low base effect will remain for some time. Food inflation will fall below the double digit levels after two-three months,? he said. Government data released on Thursday said in week ended June 12 food inflation rose to 16.9%, its highest level in 10 weeks, from 16.12% in the previous week despite government steps to tame prices of essential items and a bumper winter crop. Last year, food inflation touched 21% at the end of November after the driest spell in nearly four decades ruined summer crop, and the number remained above 17% until first week of April 2010.
Headline inflation to stay above 10% until Sep: PMEAC member
India?s food inflation may stay in double digits in next two to three months and keep headline inflation above 10% until...
Written by Tanmay Sar
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This article was first uploaded on June twenty-five, twenty ten, at four minutes past twelve in the am.