Some more monetary measures may be taken to contain the aggregate demand to counter inflation, RBI Governor Y V Reddy told members of the Parliamentary Standing Committee attached to the Finance Ministry earlier this week, sources said.
Sources said Reddy admitted that there will be no easing of inflation in the next six months. Rather it will now go over 12 per cent, the Governor is understood to have said.
When some members asked why is inflation inching towards 12 per cent mark, while in countries like Britain it is below four per cent, Reddy replied that different countries have different yardsticks for measuring inflation.
According to sources, the Governor did not give any answer to a question by members that why are prices of vegetables rising when the government says inflation is imported.
Last month, the central bank has raised short-term lending rates for banks
