Mussoorie: Reserve Bank of India said it is viewing the surge in global prices "very carefully", as it remained a matter of concern and will take monetary measures as and when required.
"We are conscious of the uncertainty in the oil situation. As of now we do not know how things will evolve. But the situation is no different from what it was at the time of announcement of monetary policy on April 18," said Reserve Bank Governor, Y V Reddy.
Global oil prices has been hovering over USD 70 dollars a barrel leading to global imbalances and there are fears that this unprecedented rise could affect economic growth of oil importing and developing countries like India.
Though global oil prices have skyrocketed, the inflation rate in the country has been at a moderate level and the weekly wholesale price index fell to 3.54 per cent.
Reddy said the moderation in inflation was not totally "unexpected". The oil prices pass through is yet to happen and "we will have to see how and when it happens".
On liquidity, he maintained that there was a plenty. In a matter of few weeks liquidity situation has turned from difficult to comfortable, indicating that it was a problem of "frictional-liquidity”.
He said Reserve Bank would not hesitate to use all instruments it had to moderate liquidity, consistent with the monetary policy stance.
Comments
0 comment