Households do not see respite from rising prices

Mumbai, Oct 14 (IANS) Households do not expect a respite from rising prices in the near future and a majority of them see at least one percentage point rise in general inflation by next year on higher costs of food, housing and services, a Reserve Bank of India survey reveals.

Households expect inflation to rise by 30 basis points to 11.4 percent in the second quarter of fiscal 2010-11 and by 80 basis points to 11.9 percent by the end of second quarter of next fiscal from the estimated current rate of 11.10 percent, according to the RBI’s quarterly inflation expectations survey of households.

‘High price rise is expected in food, housing and cost of service. On category-wise inflation expectations, housewives and daily-wage workers are comparatively more consistent in their inflation expectations,’ the RBI said in its monthly bulletin.

The survey represents the expectation of inflation for the respondent’s own basket of consumption and it is not regarded as predictors of any official measure of inflation.

‘The households’ inflation expectations provide useful directional information on near-term inflationary pressures and are also supplement to other economic indicators to get a better indication of future inflation,’ the RBI said.

The survey, conducted in the first quarter of this fiscal, gives inflation expectations of 4,000 households across 12 major cities, including the four metros – New Delhi, Mumbai, Kolkata and Chennai.

Food inflation has been in double-digit most part of this year. Annual food inflation was recorded 16.24 percent for the week ended Sep 25.

Leave a Reply

Your email address will not be published. Required fields are marked *