RBI to keep anti-inflation stance: Subbarao

India will keep up its anti-inflationary stance even if that means sacrificing growth in the short-term, the Reserve Bank of India (RBI) governor said on Monday.

Speaking on the sidelines of a Bank for International Settlements meeting, Duvvuri Subbarao said wholesale inflation was likely to come down to 6 percent by March 2012.
"In the short-term inflation is a problem for growth in India and we need to pin down inflation first in order for growth in the medium term to be sustainable, even if it meant sacrificing growth in the short term," Subbarao said.
"We've said that the central bank is to continue to persevere with an anti-inflationary response... We want to calibrate policy such that it's a soft-landing for the economy at a minimal cost."
He also said recent rises in food and oil prices threatened the government's ability to meet fiscal targets.
The RBI has been among the most aggressive central banks with nine rate rises since March 2010, but its gradual policy tightening has failed to cool inflation initially driven by high food and fuel prices, and more recently by demand pressures.
Headline inflation surged to nearly 9% in March, far above forecasts and is expected to remain around these levels in the April-September period according to the central bank's policy projections.