Cash Reserve Ratio Hike CRR

RBI warns inflation may rise. Reserve Bank Of India RBI accounted hike in food price to be the cause of Overall inflation and thus a signal for tighter monetary regime ahead. Economists and Analysts except Central Bank to raise the Cash Reserve ratio in the quarterly review by at least half a % point.Food Inflation stood at 16.81% leading to overall Inflation to 7.31% in December. The rise in food price is on a upward trail which in this week till January 16 rose to 17% fro 16.81% a week earlier.The price index of food items rose by 0.4% on a weekly basis due to rise in prices of eggs, vegetables, condiments ad spices, bajra and jowar. potato prices increased to 57.56% and pulses by 46.87%. Dals are still expensive. However, Sharad pawar assured sugar prices will come down surely. The dominance of food price inflation and uncertain recovery becomes a challenge. Central Bank revised the GDP growth rate to be 6.9%.