- IPL misses Lalit ModiPriyanka as saviour for Congress!Upcoming Bollywood movies in MayTrain enquiry on your mobile phoneSee Rani with her in-lawsKangana turns kissing machine in ‘Revolver Rani’Controversial Kisses Of Bollywood celebrities‘Maxwell Magic’ a superhit in IPL 7Bollywood Hottie Yana GuptaRani-Aditya secret love story
Formula One magnate Bernie Ecclestone faces bribery charges when his trial begins in Munic
Food inflation a credit negative for India: Moody's Last Updated : 18 Mar 2013 04:54:49 PM IST Food inflation not good for India: Moody's
"Sustained food inflation is credit negative because it exacerbates India's macroeconomic challenges of slowing growth, high inflation and large fiscal and current account deficits," Moody's Investors Service said in credit outlook report.
While Fitch and Standard and Poor's have downgraded their outlook on India to "negative" from "stable", Moody's Investors Service has assigned a "stable" outlook.
The Wholesale Price Index for February showed that food prices increased by 11.4 per cent year-on-year, raising overall inflation for the month to 6.8 per cent, despite a deceleration in core inflation to 3.8 per cent.
Moody's said India's current pace of food inflation is faster than the global average.
"Moreover, although food inflation is not desirable anywhere, it has particularly credit negative implications for India because of its economic structure and policy framework," it added.
Food inflation, it said, "hurts consumption, government finances, the balance of payments and monetary policy flexibility".
"Because the Indian government subsidises food for a large portion of the population, increases in food prices inflate government expenditure...and the budget deficit, which is already high relative to comparable emerging markets," Moody's' said.
As per the credit ratings agency, food demand is unlikely to fall, and food supply is difficult to raise.
Post Your Comment (0 posted):
If sources are to be believed, after Rani-Aditya now Uday and Nargis are getting ready to
Gregg Casarona used to be an obese virgin who had a very embarrassing first ever sex exper
Homegrown handset maker Micromax on Tuesday launched its new six-inch phablet 'Canvas Dood