Various other economies in the world were more aggressive at increasing the policy rates like Canada rose the policy rates by 300 bps, following the same US hiked by 275 bps, Australia by 250 bps, UK by 175 bps, South Africa by 225 bps and Euro Area by 200 bps, said the PHDCCI. The government has taken calibrated efforts and the Reserve Bank of India (RBI) too have significantly impacted in escalating the wholesale prices, said the president of the industry body
The wholesale price index (WPI) inflation has come down to 10.7 per cent in September 2022 from 16.2 per cent in June 2022 being the highest, said Saket Dalmia, the president of PHD Chamber of Commerce and Industry, on 3 October.
The government has taken calibrated efforts and the Reserve Bank of India (RBI) too have significantly impacted in escalating the wholesale prices, said the president of the industry body.
Dalmia said that although RBI too decision to increase the repo rate tame the inflation by 190 bps in last six months from 4.4 per cent in May to 5.9 per cent in October, gross domestic product (GDP) growth rate too has also been maintained with a lesser deceleration in comparison with many economies.
Various other economies in the world were more aggressive at increasing the policy rates like Canada rose the policy rates by 300 bps, following the same US hiked by 275 bps, Australia by 250 bps, UK by 175 bps, South Africa by 225 bps and Euro Area by 200 bps, said the PHDCCI.
Canada could bring down the inflation rate by 120 bps by taking the repo rate up to 300 bps. The US too is able to soften the inflation rate from 9.1 per cent to 8.2 per cent by hiking the Federal Reserve rate by 275 bps. South Africa on the same lines is able decrease the inflation rate from 7.8 per cent to 7.5 per cent by putting a surge in the policy rate by 225 bps, said the industry body. India is able bring the inflation rate by 0.4 per cent from 7.8 per cent to 7.4 per cent by taking the policy rate up by 190 bps, said PHDCCI.
The industry body said that the government’s move towards calibrated steps and RBI would play crucial role to bring down inflation in the targeted trajectory along with maintaining economic growth nearly by 7 per cent in the current fiscal,
PHDCCI said that WPI inflation will continue to witness the deceleration and will have a prominent impact on the price corrections in the retail inflation. Expectedly the Consumer Price Index (CPI) inflation may come down to below 6 per cent by December 2022.
Further, along with bringing the petroleum products under purview of GST, further cut in the excise duties will occur specifically on petroleum products.
The industry body said that in order to stabilise inflation trajectory in the targeted bracket of Reserve Bank of India, the measures to prevent hoarding of the essential commodities to stop price accelerations would be done. Also, the steps would be undertaken to strengthen the global value chains and shift the sources of the imports from higher price countries to low price countries.