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Planning Commission Deputy Chairman Montek Singh Ahluwalia today termed the moderation in inflation as “very good signal” (for economy) and hoped the RBI would take a cue from the decline in price rise.
“I think moderation of inflation is a very very good signal. We expect it to moderate slowly and it is good that it has happened,” Ahluwalia said here.
The inflation measured in terms of Wholesale Price Index (WPI) moderated to 7.24 per cent in November from 7.45 per cent in the previous month. It was 9.46 per cent in November 2011.
“I don’t regard seven plus per cent inflation as comfort zone. But the important thing is that if you think it is heading down, then may be the time has come to recognise that inflation is clearly softening and growth is weak and I am sure that RBI knows what to do,” he added.
Economy grew 5.3 per cent in the July-September period of the current financial year (2012-13), pulled down by the poor performance of manufacturing and agriculture sectors, showing persistent signs of slowdown.
The gross domestic product (GDP) had expanded by 6.7 per cent in the same period last fiscal. It had grown by 5.5 per cent in the first quarter (April-June) of 2012-13.
On the Government’s decision to set up a committee on investment under Prime Minister, he said: “I think that is an extremely positive development. It reflects the fact that the Government is aware that we need a special mechanism for decision making to speed up implementation. It is a very good signal.”
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