Inflation will ease to 10 per cent by December, according to Rajya Sabha member and immediate past chairman of the prime minister's economic advisory panel C Rangarajan.
"Even though crude oil prices are cooling off, inflation will remain in double digits at the end of this year. My own estimate is that probably by December, inflation rate may go down to 10 per cent," Rangarajan told reporters on the sidelines of a business meet in New Delhi on Monday.
"Global financial systems are under stress and this is really a critical situation," Rangarajan added.
When asked on what ought to be the Reserve Bank of India's next step, Rangarajan said it was a difficult question to answer.
"The government is facing a dilemma because whatever measures is required to tame inflation is not necessarily good for financial stability," he said.
Inflation stood at 12.1 per cent for the week ended Aug 30 despite moderation for three weeks in a row.