Inflation figures turned a tad benign on Wednesday, but expect no more than a pause in RBI’s relentless control of money supply through policy interest rate hikes when it holds a credit policy review meeting on Friday.
Prices are still not out of worry zone, though calls for a rate cut have grown louder after factory output data this week showed a contraction.While inflation eased to 9.11% in November from 9.73% in October, it still remained at much above the threshold level. "Sustained high level of inflation that has been a major policy concern is now beginning to moderate," finance minister Pranab Mukherjee said.
Captains of industry made a strong pitch for cutting policy rates.
“IIP numbers reflect we are stagnant now,” said JJ Irani, former director, Tata Sons. “RBI and government need to face this issue.”