Inflation has come down since two months
Inflation has come down since two months

The inflation rate in India has been falling over the past two months. The cycle of policy rate increases is set to come to a stop as November’s retail inflation rate dropped to 5.88%. In research released on Monday, economists from SBI, the largest bank in the nation, provided this information.

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The RBI is in charge of controlling inflation between 2 and 6 percent. According to economists, the retail inflation data for November is positive for putting a halt to the cycle of policy rate increases.

The RBI‘s strong monetary policy approach, according to the research, might aid in bringing domestic inflation under control. It has been said that the Federal Reserve, America’s central bank, may need to raise the policy rate until the country’s inflation is under control. This will result in more capital leaving emerging markets. The currency rate will fluctuate, and the value of the rupee will decrease.

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However, according to experts, between December 2022 and January 2023, the headline inflation rate might increase once again to 6.5 to 6.7 percent. While it is anticipated to drop further to 5% by March 2023.

Repo rate increased 5 times

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To combat inflation, the central bank has raised the policy rate repo by 2.25 percent five times since May. In its monetary policy review from last week, the Reserve Bank forecast that inflation would fall to 6% in the quarter between January and March.

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