Urban households expect inflation to remain high till the second half of next financial year, a survey by the Reserve Bank of India (RBI) has found.
In December, 2012, household inflation is expected to be 13.3%, higher than the 12.9% perceived for September, 2012, and daily-wage workers and housewives expected higher inflation rates to continue, the survey said.
As per the 'Inflation Expectations Survey of Households: December 2011 (Round 26)' conducted by the apex bank, the rise is anticipated to be mainly on account of movement in food prices.
Only 36% of the respondents believed the Reserve Bank is taking the necessary action to control inflation.
While the housewives surveyed expect inflation to stand at 13.7% in December, 2012, daily wage workers said it would be 13.8%.
On the other hand, both financial sector employees and the self-employed project inflation to be 12.8% by the year-end.
"The general price expectations are observed to be more aligned with food price expectations as compared with other product groups. Around 90% of the respondents appeared to have been driven by expected changes in food prices for arriving at general price expectations," the survey said.
The survey found that households expect inflation to rise further by 140 basis points during the next 12 months from the perceived current rate of 11.9% in the October-December quarter of the current fiscal.
Headline inflation, as measured by Wholesale Price Index (WPI), fell to a two-year low of 7.47% in December, 2011. Before that, it was hovering near double digits for most of the last two years.
