statesman news service
NEW DELHI, 14 JUNE: Citing declining WPI-based inflation in May, corporate India today called for a rate cut by the Reserve Bank of India (RBI) at its policy review meeting on Monday. “With the downward trend in prices holding on, the RBI can consider a cut in the policy rate in the forthcoming monetary policy review on Monday,” said Ms Naina Lal Kidwai, president of Ficci.
The growth in the non-food credit has not really picked up with latest numbers indicating a growth of 14.3 per cent as on 31 May 2013. The banks are not really lowering the lending rates and this does show a weak transmission of the policy, she said.
Mr Chandrajit Banerjee, director-general, CII, said inflation, which has touched a low of 4.7 per cent in May 2013 as against 4.9 per cent in the previous month, has been showing signs of tapering off during the last few months and has been brought about by a fall in fuel and manufacturing prices. 
However, what is causing concern is the resurgence in food inflation owing to a moderate rise in prices of fruits & vegetables, onion, milk, eggs, cereals and rice, he added. Going forward, the prospects of a good monsoon may dampen food prices.