Published on Fri, Jun 20, 2008 at 16:28 | Source : Moneycontrol.com
Updated at Fri, Jun 20, 2008 at 18:44
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Inflation is a threat to growth: CII
At 11.05% growth in WPI for the week ending 7th June 2008, inflation is reaching the concern zone, said CII in a press release issued here today. This is the first weekly figure to factor in the fuel price hikes, which were announced on 4th June, and hence is not completely unexpected, said the CII release.
At 11.05% growth in WPI for the week ending 7th June 2008, inflation is reaching the concern zone, said CII in a press release issued here today. This is the first weekly figure to factor in the fuel price hikes, which were announced on 4th June, and hence is not completely unexpected, said the CII release.
However, inflation at double digits is a threat to the growth prospects of the country, and poses a huge challenge to the government, said CII. The government has been doing everything within its capacity to contain inflation. The current levels of inflation, which is a reflection of global prices reduces the space for fiscal and monetary policy maneuverability, without seriously impacting growth.
Out of the box solutions are required to be explored, and industry would be happy to work with the government in containing inflation and ensuring that the growth momentum of the economy is not seriously damaged, said the CII release.
There is probably a case building up for the governments of the world to come together to deal with the global prices of critical items that are fuelling inflation. It is not just India, but most large economies, which have a lot to lose if the global price pressures continue, said CII.
