RBI would initiate steps to curb inflation

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Hyderabad, Jun 5 (UNI) Reserve Bank of India (RBI) Governor YV Reddy tonight said the Central Bank would use all available instruments, both conventional and non-conventional, to curb inflation.

Talking to newspersons here, the RBI Governor said " we are ready to use foreign exchange reserves to manage oil shocks. We are vigilant on this front".

Dr Reddy said the spurt in crude oil prices posed an extraordinary situation. The RBI was carefully managing the liquidity condition and will continue to focus on the issue, he added.

He said food prices in India had shown signs of moderation this year, while increase in food prices was led by wheat during 2006.

The prices of rice and edible oil had also increased in 2007, he added.

He said the outlook for the financial market in our country was encouraging. The Global financial market, which faced crisis earlier, had recovered to some extent and our financial market was strong and risilient, he added.

He said the price rise of crude oil in the International market was anticipated. The steps taken by the Union Government to share the people's burden after the price hike had not progressed so far, though the Centre's package had provided relief to them. he added.

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