The International Monetary Fund (IMF), predicted on Tuesday that the inflation rate in India is expected to decrease to 5 percent in the next fiscal, down from the current fiscal’s rate of 6.8 percent, and then further to 4 percent in 2024, according to their website.
The IMF’s Division Chief of Research, Daniel Leigh, said, “Inflation in India as in other countries is expected to come down from 6.8 percent in 2022 to 5 percent in 2023 and then 4 percent coming towards the target in 2024.” He further stated, “That partly reflects the central bank’s actions.”
The recent developments come in the background of the IMF’s prediction of global inflation falling from 8.8 percent in 2022, 6.6 percent in 2023, and 4.3 percent in 2024 – greater than pre-pandemic levels of approximately 3.5 percent. The projected reductions are partly due to decreasing global commodity prices – both fuel and non-fuel – because of weak demand. Another reason for this would be the receding effects of tight monetary policies implemented for controlling inflation.
“Still, disinflation will take time: by 2024, projected annual average headline and core inflation will, respectively, still be above pre-pandemic levels in 82 percent and 86 percent of economies,” said the United Nation’s financial agency. Regarding developing countries that fall in the low-income bracket, inflation is predicted to fall from 14.2 percent in 2022 to 8.6 percent in 2024 – still high, but near to the pre-pandemic average, it further stated.