Chidambaram confident of controlling inflation

Finance Minister P Chidambaram is confident that the government will soon control inflation.

New Delhi, May 30 : Finance Minister P Chidambaram is confident that the government will soon control inflation.

"It is worrisome, but we are confident of gaining mastery over inflation," he said.

He further added that authorities may take more steps to control inflation if needed.

Inflation has reached 8.1 per cent, marking fresh trouble for the United Progressive Alliance (UPA) government which has been desperately trying to rein in prices of oil and essential commodities in an electorally important year.

Wholesale prices climbed to 8.1 percent in the week ended on May 17 from a year earlier, after rising to 7.82 percent in the previous week, the government said on Friday.

Inflation had surged to a 44-month high of 7.83 per cent for the week ended May 3, before falling to 7.82 percent the following week.

The inflation numbers are likely to cause problem to the Reserve Bank of India (RBI) as the rate is much higher than the target set by the bank. The central bank has targeted inflation at 5.5 percent for the year FY 2007-08. In order to suck liquidity from the market, the RBI last month had increased (Cash reserve ratio) CRR in two phases, to 8.25 percent -the highest since March 2001-from 7.5 percent.

ANI