Decline in inflation inspiring, look ahead to rates cut: PHDCCI

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SME Times Nes Bureau | 15 Mar, 2014
The decline in WPI inflation to 4.68% in the month of February 2014 is inspiring and is a positive sign and also an indication of price stability going forward, said Mr. Sharad Jaipuria, President, PHD Chamber of Commerce and Industry, in a press statement issued in New Delhi on Friday.

The decline in WPI inflation is attributed mainly to steep reduction in inflation in vegetables as well as potato prices. The WPI inflation declined to 4.68% in the month of February 2014 as against 5.05% during January 2014 and 6.4% in December 2013 and 7.52% in November 2013.

Since the industry growth is in its low gear, so at this juncture, PHD Chamber therefore expect, a cut in repo rate in the coming times, said Jaipuria.

A cut in repo rate at this juncture would pave the way for economic recovery to become more visible and sustainable, he added.

We believe that in the coming times, government needs to act effectively to improve and fasten the supply chain process to prevent jump in prices of various commodities especially the food items which causes cascading impact on the overall WPI inflation scenario said Mr. Jaipuria.

Further, the need of the hour is to encourage investments in infrastructure sector especially the agriculture infrastructure in terms of supply side infrastructure i.e. farm gate to consumer doorstep supply chain management, which could effectively tackle the challenge of inflation, he added.