Today Inflation is a topic with which every single person of the country is aware. In the past very few people used to know what inflation is and what is inflation rate, those who know was also the learned people. But at present even a school going boy can be found saying- “last week’s inflation rate was 12.44% govt. must do something”.
Although our country is kissing the double digit growth mark the inflation rate has already crossed it. Thus the impact of that growth has compressed due to the growing inflation rate. Although the middle class, upper middle class, and higher class people does not experience the impact of inflation to such a great extent but those people who earns a fixed amount of remuneration everyday for them the impact of inflation is drastic. Because although the prices of commodities are going high but the money which they are receiving in the form of wages are still the same as a result large numbers of people are forced to commit suicide. This is a matter of great shame that a country who has a prime minister as one of the renowned economist has to face this kind of situation. If this trend of rising inflation continues than their will be a list of problems which our nation has to encounter with in the near future.
Government has also taken large number of steps on his part like the reserve bank of India has raised Repo rate by 50 basis point from the 9% from the existing 8.5% . This short term rate at which the RBI lends cash to bank was last raised on 24 June by 50 basis points to 8.5 %. The move is directed at cooling inflation that is running nearly 12% on an annual basis by containing demand.
The central bank has also raised the CRR (percentage of bank deposit which they must keep with central bank) by 25 basis point from the existing 8.75%. This will come into effect from August 30.
The reverse Repo rate (the short term rate at which the central bank absorbs cash from the market) remains unchanged at 6%. It has also raised the bank rate(rates used to price long term loans to firms and individual) steady at 6%.
In his recent interview R.B.I governor Y.V. Reddy said that they try to restrict the growth rate at about 8 and the inflation rate at about 5% by the end of this year, because growth of a country can not be done at the cost of common people.
Although our country is kissing the double digit growth mark the inflation rate has already crossed it. Thus the impact of that growth has compressed due to the growing inflation rate. Although the middle class, upper middle class, and higher class people does not experience the impact of inflation to such a great extent but those people who earns a fixed amount of remuneration everyday for them the impact of inflation is drastic. Because although the prices of commodities are going high but the money which they are receiving in the form of wages are still the same as a result large numbers of people are forced to commit suicide. This is a matter of great shame that a country who has a prime minister as one of the renowned economist has to face this kind of situation. If this trend of rising inflation continues than their will be a list of problems which our nation has to encounter with in the near future.
Government has also taken large number of steps on his part like the reserve bank of India has raised Repo rate by 50 basis point from the 9% from the existing 8.5% . This short term rate at which the RBI lends cash to bank was last raised on 24 June by 50 basis points to 8.5 %. The move is directed at cooling inflation that is running nearly 12% on an annual basis by containing demand.
The central bank has also raised the CRR (percentage of bank deposit which they must keep with central bank) by 25 basis point from the existing 8.75%. This will come into effect from August 30.
The reverse Repo rate (the short term rate at which the central bank absorbs cash from the market) remains unchanged at 6%. It has also raised the bank rate(rates used to price long term loans to firms and individual) steady at 6%.
In his recent interview R.B.I governor Y.V. Reddy said that they try to restrict the growth rate at about 8 and the inflation rate at about 5% by the end of this year, because growth of a country can not be done at the cost of common people.
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