RBI will review monetary policy if inflation persists

Last Updated: Wednesday, December 9, 2009 - 22:13

Kolkata: The Reserve Bank will review its
monetary stance if inflationary pressure continues, Governor D
Subbarao said on Wednesday.

"If inflationary pressure persists for a long time
it can fuel inflationary expectations and monetary policy
will have to take a nuanced view on this," Rao told reporters.

Admitting to a dilemma over price rise, he said,
"Wholesale price index is quite modest, while consumer price
index is quite high. Food inflation is 17.5 percent and
there is dilemma in managing the current situation," Subbarao
said after meeting Chief Minister Buddhadeb Bhattacharjee.

"The food price inflation engenders inflationary
expectations," he said.

PTI



First Published: Wednesday, December 9, 2009 - 22:13

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