India's inflation will moderate to below 5%, FM says
2013-11-21 12:16:37
India's wholesale price inflation will moderate to a level below 5 percent, Finance Minister Palaniappan Chidambaram said Thursday.
The finance minister noted that there is reasonable stability in the prices of major commodities such as wheat and rice. However, prices of fruit, vegetables, meat, milk and eggs are elevated and are driving the inflation rate, he said in Singapore.
In October, headline inflation rose to 7 percent, the highest in eight months, from September's 6.46 percent.
At its rate-setting meeting in October, the Reserve Bank of India said wholesale price inflation is likely to remain at higher than current levels through most of the remaining part of the year.
Chidambaram today said the fiscal deficit target of 4.8 percent of gross domestic product will not be breached under any circumstances.
Elsewhere, Fitch Ratings said the sharp depreciation of the Indian rupee in mid-2013 highlights India's difficult transition following an extended period of low growth, high inflation and a widening in the current account deficit.
The ability to implement fiscal consolidation and continue with the overall economic adjustment process would support India's sovereign credit ratings, it said.
Chidambaram announced that the special swap facility will close on November 30.
"Two months ago, the Reserve Bank opened a special window to attract more funds into FCNR(B) and I am happy to report that, as I speak to you today, the scheme, which will close on November 30, 2013, has received $16 billion," he said.