NEW DELHI : Attributing the rise in inflation to supply-side frictions, Chief Economic Adviser K V Subramanian has exuded confidence that retail inflation will come down in the days ahead with the easing of lockdowns. "If you look at inflation...it's primarily because of those supply-side frictions, but as local lockdowns are actually being reduced, these frictions should basically go down," he told PTI. "Overall, the difference between wholesale and retail inflation is primarily due to supply-side factors which should decrease and therefore going forward even the retail inflation should ease," Subramanian said. There are fears that retail inflation would remain at an elevated level during the rest of the year limiting the scope for the RBI to further ease the benchmark interest rate. Retail inflation so far has been in the tolerance range of MPC except for breach in July.

Source: Mint September 13, 2020 05:37 UTC