Investing tips: Target firms in a better position to handle inflation

The Reserve Bank of India (RBI) will not cut rates anytime soon and may even be under pressure to hike policy rates, if crude prices remain elevated

The signals on the inflation front appear to rather confuse. But, inflation is more likely to rise than not. Global factors, namely higher First World growth, are creating an upwards trend in most commodities. Crude oil price has risen by 45 per cent in the last six months and it's likely to stay close to current levels or move higher. Industrial metals are up by 20 per cent in the last year. 

A domestic component, food, which has a large weight in the Indian inflation basket, is showing discrepancies between wholesale and retail price indices. The WPI (Wholesale Price Index)