MUMBAI Jan 30 India's consumer inflation should
ease in the next two months, and will fall to 8 percent by the
end of the year, central bank governor Raghuram Rajan said in an
interview with TV news channel CNN-IBN on Thursday.
The comments came after the Reserve Bank of India
unexpectedly raised interest rates by a quarter percentage point
on Tuesday, marking its third hike in five months.
The consumer price index eased to a three-month low of 9.87
percent in December. A central bank panel last week had
recommended bringing down the retail inflation gauge to below 8
percent by January 2015.
"There is some disinflation in the system. What was 9.87 is
going to come down further next month, and probably a little
further into March," Rajan told CNN-IBN.
"We are setting rates at a level that we think is consistent
with that disinflation for us to get some bite and for the
inflation in the system to come down to about 8 percent at the
end of the year."