Cabinet to meet on inflation next week

With inflation touching a four-year high, the Cabinet Committee on Prices will meet next week for the second time in less than a month to co...

With inflation touching a four-year high, the Cabinet Committee on Prices will meet next week for the second time in less than a month to consider steps to arrest its climb.

As per normal practice, no specific steps have been circulated for consideration of the members. The measures, if any, would be submitted at the meeting. Officials say that though the government is worried, there are little corrective options in the short run to rein in inflation.

The wholesale price index shot to 8.33 per cent for the week ended August 28 on account of higher oil prices despite measures last month by the government to soften the inflationary pressures on the economy.

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The CCP meets on Wednesday, the day producers’ cartel OPEC sits in Vienna to review the rising oil prices. Petroleum Minister Mani Shankar Aiyar this week wrote to the Prime Minister’s Office that India must await the outcome of the OPEC meeting. ‘‘There is little cause for alarm or panic. Indeed, if government acts precipitately, there is danger of this sending panic signals to the markets and the country at large,’’ Aiyar wrote to National Security Advisor J.N. Dixit as well as to Planning Commission Deputy Chairman M.S. Ahluwalia.

September 15 is also the date when oil companies conduct fortnightly review of consumer prices. These firms have been given the freedom to tinker prices if global prices move within a 10 per cent band.

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