The Planning Commission on Tuesday said that inflation is not coming down as expected and it would be a little higher than the earlier forecast of close to 6 per cent for the month of December.
“I have to be honest. I had said about 6 per cent (for the month of December). I would say that it will probably be a little higher than that,” Planning Commission Deputy Chairman Montek Singh Ahluwalia told reporters.
Earlier, on several occasions, Mr. Ahluwalia had said that the inflation would be close to 6 per cent by December.
Continuing with its trend towards moderation, inflation declined to 7.48 per cent in November, mainly boosted by lowering of pressure on certain food items. Inflation had stood at 8.58 per cent in October this year. It was 4.50 per cent in November 2009.
“If I had to make the forecast several months ago... I would make it once again, I would raise little bit (higher than 6 per cent for December),” he said.
He pointed out, “Inflation may not go down as low as I expected, but it is much better than many people feared. A lot of people were saying it will be 8 per cent in December.”
Asked if status quo would be maintained on short term monetary management so that growth momentum is not disrupted, Mr. Ahluwalia said, “I have consistently maintained that we should not get too concerned about the effect of short term monetary management on immediate term growth.”
“Growth is driven by more factors than merely short term monetary rates,” he added.