"I believe that even if in this particular week it (inflation) has risen, it will come down. I believe that the monsoon has an effect on the availability of foodgrains which you will see in months ahead," he said while addressing the Economic Editors' conference here.
Food inflation rose to a nearly six-month high of 10.60 per cent for the week ended October 8. Headline inflation was 9.72 per cent in September.
Answering questions on the growth prospects of the economy, the chairman of the Prime Minister's Economic Advisor Council (PMEAC) said that it would be 8 per cent during 2011-12, marginally down from its earlier estimate of 8.2 per cent.
"The PMEAC had projected a growth rate of 8.2 per cent in July 2011. There are many factors which will require us to adjust it downwards. I expect that the growth rate in the current year will be close to 8 per cent", he added.
The agricultural growth would be stronger than what was anticipated, he said adding, "the industrial growth rate will be lower, while the services sector growth rate will remain more or less the same." As regards fiscal deficit, Rangarajan said, it would be a Herculean task for the government to retain it at 4.6 per cent of the GDP estimated at the time of presentation of Budget for 2011-12.
"It could be slightly higher than 4.6 per cent. I think it is very difficult to talk about number. It could exceed by a small margin," he added.