India WPI Inflation reduced to 6.55% ( Jan 12 )

As expected India Monthly inflation has come down to below 7% in the latest release for the Month of January 2012. Inflation was a concern point for RBI & Indian policy maker since long time as it was coming down below 9% since long time. The latest inflation rate is 6.55% for the Month of Jan 2012.This is the lowest level since last 26 Months. Decline to this level was also not expected by RBI who had maintained that it will be around 7%.The average Inflation for the FY 2012 is expected to be around 8.6% and it will remain range bound during the entire FY 2013. It is not likely to fall beyond 6%. As the Inflation has come under control RBI may consider reducing the interest rate in its next Quarterly review of Monetary Policy in the Month of March 2012. Till now RBI has only reduced the CRR to improve liquidity in the Market.