INTEREST RATE RBI BEST TOOL TO CONTROL INFLATION

INTEREST RATE RBI BEST TOOL TO CONTROL INFLATION :

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RBI Governor Mr.Raghu Ram Rajan said the "BEST TOOLS" available with the central bank to control price rise is interest rate.

Our best tool to control inflation is interest rate he said addding the government too has tools like increasing agricultural production and inproving suppply.
Both need to work together and will work together . we were expecting some increase in the CPI  number because of the seasonal effects from vegetable prices,but it came more than anticipated by the consensus forecast .We will study them in detail.What it suggest is that inflation is high as for as food prices go .

Mr.Rajan was talking to reporters after the RBI's Board meeting.He,however said the core inflation has been coming down but through very very gently.
Mr.Rajan said SEBI and the finance ministry have drawn up a contingency plan to deal with any excessive market volatility .

TheRBI said it has come across a spate of fictitious offers of cheap funds in recent times from the fraudsters through letters e-mails,SMS,Mobile phone.
The central bank has cautioned that any person resident in India collecting and effecting /remitting such payments directly indirectly outside India would make  himself /herself liable to be proceeded against with for contravention of the foreign exchange management act ,1999 besides being liable for violation of regulations relating to know your customer (KYC) norms /Anti Money laundering (AML) standards.