RBI’s strategy fails to curb inflation rate

By Accommodation Times (www.accommodationtimes.com)
Reserve Bank of India (RBI) has increased the interest by 12 times in the previous seventeen months for curbing inflation rate but this strategy failed miserably and has slowed the Indian economy. The growth rate that has been experienced by the business pundits and economy too has now over.
However, in 2011 the growth has fallen to 7.7percent. On the basis of last five years report the finance minister has said that in the current fiscal year India will be able to maintain 9% GDP, but market condition shows that they have failed to maintain their promise. Whereas, the reserve bank of India said that rate of growth of economy will be not less than 8%.
The rising interest of housing finance has absorbed the entire credit from the market. In the last 17months borrowers rate has gone up by 3percent. The growth rate which was set by the government in 2008 and 2009 got affected by the high interest rate of banks.

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