Just a couple of days ahead of the Reserve Bank’s monetary policy, the Finance Minister, Mr Pranab Mukherjee, today said the Government and the RBI together will be able to tackle soaring inflation, which he attributed to global price pressures.

“It (inflation) is perilously close to double digit...RBI is also watching the situation like the Government and collectively it would be possible for us to tackle the problem,” Mr Mukherjee told reporters here.

His comments came as headline inflation soared to 9.78 per cent in August, from 9.22 per cent in the previous month, because of rising prices of food and manufactured items.

Mr Mukherjee attributed the rise in the rate of prices to global factors and said the increase was on expected lines.

“Of course, in the overall environment, all over the world, it was expected that inflationary pressure would rise in all groups including manufacturing (segment),” he said.

“This is a time of stress not only in India but the worldover and we shall have to maintain our nerves and we shall have to see how we can overcome the problem,” he added.

The RBI is scheduled to announce its mid-quarterly monetary policy review on September 16. It is facing a tough situation of managing a situation of high inflation co-existing with moderation in economic growth.

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