SHORT EDIT: RBI still hesitant to let down its guard!
There is no denying that inflation is on a downward spiral for the past month or such, Reserve Bank of India (RBI) is not letting its guard down. The central bank believes the path ahead is not so smooth, as reflected by the markets. There exist various upside risks in the path towards the January 2016 inflation target.
As efundsplus has been arguing over the past few weeks, the battle against inflation is not over as yet, now, the governor has also articulated, though a revival is in sight, demand could lead to burst of inflation. There better be attentive while walking on the path ahead.
Though promise from the NDA government to borrow less and work on fiscal consolidation seems to be lived in every spirit at least for present.
Considering the global context, with QE all set to be scrapped and US interest rates most likely to be raised by the middle of 2015, there lies a chance ahead of global financial instability.
India’s main aim should be to work on getting inflation under control so that any kind of turbulence in global economy doesn’t send the rupee in to free fall as happened in the month of August in the year 2012.