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Inflation Quite Likely To Go Down After Monsoon

Neha Sood, Tuesday 20th July 2010


The ever increasing inflation rates that have been affecting the common people in the direst manner might halt and may go down by 5 to 6 per cent by December this year according to the assessment made by the government. This major downfall in the inflation is attributed to the forecast of a healthy monsoon. According to the Cabinet good monsoon is expected to yield good crops which in turn should enhance the growth rate of the economy to 8.5 per cent for this year. Finance minister Mr Pranab Mukherjee has also expressed the opinion that inflation may come down after the monsoon.


Food inflation in particular had aggravated and for the last 3-4 months stability in the price variations was very much visible. Now with positive monsoon it is very much expected that the overall inflation may finally come down to the single digit figure after several months. The inflation currently for the month of June stood at 10.55 per cent.


This sharp descent in inflation is also propelled by the fact that the economic growth rate have also picked up some pace due to the stimulus packages offered by the RBI and the government to facilitate a flexibility in the liquidity rates. The global economic crisis had forced down the growth rate to 6.7 per cent from a healthy 9 per cent but the International Monetary Fund\'s projection were very positive as market experts hoped for a strong growth of 10 per cent in the near future.

 
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