September 28, 2023 9:48 AM

RBI committed to bring down inflation to 4%; watchful of price risks: Governor Das

NEW DELHI: Reserve Bank Governor Shaktikanta Das on Tuesday said the central bank has a commitment to reducing inflation to a target of 4 per cent. Additionally, it will maintain a vigilant stance in monitoring potential risks, particularly as frequent global supply disruptions can significantly impact price management.
Shaktikanta Das while delivering a lecture at the Delhi School of Economics, said the RBI remains vigilant, aiming to prevent the emergence of secondary consequences, such as the generalization and persistence of inflation.
The central bank has been mandated by the government to keep inflation at 4 per cent with a margin of 2 per cent on either side.
“The frequent incidences of recurring food price shocks pose a risk to the anchoring of inflation expectations, which has been underway since February 2022. We will remain watchful of this aspect also.
“The role of continued and timely supply side interventions as is being undertaken by the government assumes criticality in limiting the severity and duration of such food price shocks,” he said.
In these circumstances, he said, it is necessary to be watchful of any risk to price stability and act timely and appropriately.
“We remained firmly focused on aligning inflation to the target of 4 per cent,” he added without giving any timeframe.
He also said that inflation, which had touched a high of 7.4 per cent in July, driven by a rise in vegetable prices, has started moderating.
Earlier in June, the Reserve Bank of India marginally lowered its inflation projection for the current financial year to 5.1 per cent.
In April, the Reserve Bank had estimated the consumer price index (CPI) based retail inflation at 5.2 per cent during the fiscal 2023-24.
CPI inflation fell sharply to 4.7 per cent in April 2023, from 6.4 per cent in February, on the back of favourable base effects, with softening observed across all the three major groups.

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