INDIA’S SOFT PATCH

INDIA'S ECONOMY HITS A VERY WELCOME SOFT PATCH

Edward Hugh

Seeking Alpha, June 21, 2011

As the European Central Bank moves steadily and earnestly forward with its ongoing rate hike cycle -- sending one fragile economy after another along Europe's periphery drifting off towards recession -- there is at least one prominent global central banker who must be feeling vindicated in the policy stance he has taken to try and bring the rampant inflation from which his country has been suffering back under control.

Duvvuri Subbarao is governor of the Reserve Bank of India, and under his stewardship the central bank has been hard at work over the last 12 months trying to credibly fight inflation. So far rates have been raised 10 times, and the bank has managed to claw the annual rate of wholesale price inflation back from its peak of 10.9% to the current level of 9.06%. Hardly a level to be complacent about, but then Subarrao seems far from complacent.

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