Asssocham has suggested government to adopt unconventional instruments to control inflation rather than depending on the convential methods like raising the interest rates which is not helping to solve the problem at the core level.
“Conventional monetary measures do not directly address the cause of inflation, but rein in expectations of it spiralling out of control by attempting to compress demand,” Assocham said without suggesting any measures.
As the apex bank has increased the short-term lending and borrowing rates 10 times since March 2010 to tame the inflation, which was over nine per cent in May. Food inflation was hovering around 8.96 per cent in mid-June.
