RBI chief D Subbarao expects inflation to trend lower in Jan-Mar

KOLKATA: The Reserve Bank of India said inflation remains elevated but may ease in the new year. Governor D Subbarao said growth has moderated and the central bank would review the growth-inflation dynamics in the next monetary review scheduled for December 18.

“Inflation at 7.5% is still high and we expect it to come down in the fourth quarter,” Subbarao said Thursday, after apprising its central board about current economic issues.

Subbarao with his deputies and RBI central board members were in the city for their board meet. The governor said the central bank is ready to review the ideal short-term inflation target, following a suggestion from his predecessor YV Reddy last month.

The RBI also wants strict enforcement of state laws to prevent chit funds from duping depositors. It said it has written to all state governments to formulate action plans against these multi-level marketing companies.