Inflation rate is 5.06 % as on May 17: CCP

New Delhi, May 31 (UNI) The Cabinet Committee on Prices(CCP) today reviewed the price situation and noted with satisfaction that the inflation rate has come down to 5.06 per cent as on May 19, the last date for which the data is available with the Committee.

The last figure officially reported for inflation rate is 5.27 per cent for May 12, 2007, as measured by the Wholesale Price Index(WPI).

Briefing newspersons on the outcome of the CCP meeting, Finance Minister P Chidambaram, however, said the CCP took no decision, but merely reviewed the price situation.

This is the third consecutive week when the WPI has come down, reversing the earlier trend of spiralling prices.

Earlier, Mr Chidambaram had spoken about the dangers of high growth to maintaining price stability. He was of the view that high growth generates high demand, and if not matched by adequate supplies then there could be a pressure on prices.

The CSO today reported a growth rate of 9.4 per cent for the fiscal 2006-07.

Mr Chidambaram had also stated that the large inflows of External Commercial Borrowings would lead to enhanced money supply. As it would be unwise to put curbs on ECB flows, which reflect the confidence of the Indian Corporate sector to raise funds from overseas, the solution lay in the Central Bank doing a tight rope walking on the two fronts.

UNI