RBI to be sensitive to high global crude, food prices: Reddy

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Mumbai, Jan 21 (UNI) The Reserve Bank of India (RBI) will continue to be sensitive to high global crude and food prices, Governor Dr Y V Reddy said here today.

''These are essential commodities and the prices have great impact on inflationary expectations,'' Dr Reddy told reporters on the sidelines of the 5th convocation ceremony of the Indira Gandhi Insitute of Development and Research in suburban Mumbai here.

''The RBI had anticipated high global food and crude oil prices and the pressures have been flat,'' he said.

When asked about liquidity, Dr Reddy said, it had been volatile in the past. ''It has been some times tight and sometimes easy and therefore one has to take a long-term view and not a contextual view,'' he added.

Though global financial uncertainties were not entirely unanticipated, the intensity and duration of the global crisis was neither predicted nor expected, he said. ''The global outlook is far more uncertain than anticipated,'' he added.

Dr Reddy said that the macro economic survey and credit policy next week will present a detailed study on the issues.

UNI MR DB AG1502

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