India’s govt, RBI need to step up vigilance on higher inflation expectations, Finance Ministry says
Global and regional uncertainties and domestic disruptions may keep inflationary pressures elevated in India for the coming months, the Finance Ministry said in a report released Tuesday.
“Going forward, while domestic consumption and investment demand are expected to continue driving growth, global uncertainty and domestic disruptions may keep inflationary pressures elevated for the coming months, warranting greater vigilance by Government and the RBI,” the Department of Economic Affairs wrote in its July issue of Monthly Economic Review.
Notably, retail inflation in India has surged to 7.4 per cent in July from 4.9 per cent in June. The latest rise in inflation could partly be attributed to the current spurt in tomato and other vegetable prices across India. The rise in tomato prices is reported across the country, and not just limited to a particular region or geography. In key cities, it rose to as high as Rs 150-200 per kg.