Inflation eases to 4.7%

The Wholesale Price Index (WPI) based inflation fell to 4.7% in May 2013. A decline in the prices of manufactured items helped bring down inflation. In May 2012 it was 7.55%, while in April 2013 it was at 4.89%.

Finance Minister P Chidambaram says the measures taken by the government since August have been successful in bringing down inflation and the fiscal deficit. He added that more reform measures will come up by the end of June-July to boost investment and growth.

There have been demands for a lower interest rate in the backdrop of declining inflation. Inflation data would be closely watched by the Reserve Bank while formulating its mid-quarter policy which is scheduled on Monday.

India faces its own unique challenges, given consumer inflation remains elevated while a current account deficit that hit a record high of 6.7% in the October-December quarter continues to weigh on the rupee.

The World Bank has forecast a 6.7% growth rate for India by next fiscal as exports and private investment are projected to strengthen and provide a boost to growth.

Today, prices of RSS4 grade closed at `.175 a kg at Kottayam and RSS3 closed at `.162.09 a kg at Bangkok, while Malaysian SMR20 closed at `.134.56 a kg. On the Tokyo Commodity Exchange, June futures series closed at ¥230.2, July at ¥232.7, August at ¥233, September at ¥233.3, October at ¥233.6 and the contract for delivery in November closed at ¥235.3 a kg. While on the National Multi Commodity Exchange June futures were trading at `.175, July at `.171.50, August at `.168.51, September at `.166, October at `.164 and November at `.159.24 a kg., at 4.45 pm IST.

Read lot more in Rubber4U – 15th June 2013 issue