New Delhi: The Reserve Bank of India (RBI) is likely to assess inflation trends in March before finalizing its annual monetary policy, to be announced on 20 April, chief economic adviser Kaushik Basu said.
“The RBI raised repo and reverse repo rates (short-term lending and borrowing rates) to give signal to markets on inflationary expectations as inflation has slightly spilled over to manufactured products,” Basu said.
He, however, noted that food inflation had been moderating and declined considerably in the first week of March. “Fortunately, food inflation is coming down. This RBI action is a bit of anticipatory move.”
Inflation declined from 17.81% in the last week of February, but still stood at 16.3% in the first week of March. Basu predicted food inflation would remain high for one more month.