Deflation suggests significant cut in interest rates to revive demand: PHD Chamber

Deflation suggests significant cut in interest rates to revive demand: PHD Chamber

Deflation suggests significant cut in interest rates to revive demand: PHD Chamber

 

No.PR-214
March 16, 2015
New Delhi
 

Deflation suggests significant cut in interest rates to revive demand: PHD Chamber
 

Sharp fall in prices of international commodities especially the crude oil prices and lackluster demand scenario has led to a deflationary situation in the economy, said Mr. Alok B Shriram, President, PHD Chamber in a press statement issued here today.
 

WPI inflation declined from (-) 0.39% in January 2015 to (-) 2.06% in February 2015.
 

The manufactured products registered a decline in inflation from 1.05% in January 2015 to 0.33% in February 2015 while inflation in fuel and power decline to (-) 14.72% in February 2015 from (-) 10.69% in January 2015. Further, there is a marginal decline in inflation of food articles from 3.27% in January 2015 to 1.43% in February 2015.
 

However, the inflation in onions has increased significantly from (-) 1.90% in January 2015 to 26.58% in February 2015.
 

Going ahead, the calibrated measures undertaken by RBI during the recent times vis-à-vis 50bps cut in repo rate during the last 2 months would help demand to rejuvenate in the coming times, said Mr. Shriram.
 

We expect further monetary policy easing and repo rate to come down to the level of 6%, going forward, he said.
 

ENDS

Koteshwar Prasad Dobhal
Consultant (PR)