RBI may step up monetary tightening measures: PMEAC

Finance minister Pranab Mukherjee has expressed hope that the overall inflation will come down to 7% by March end

New Delhi: The Reserve Bank of India (RBI) may take further monetary tightening measures to tame inflation which stood at 8.23% in January, reports PTI quoting the Prime Minister's Economic Advisory Council.

"RBI will have to take a view looking at level of inflation. It is still at an uncomfortably high level. Some action, continued action, by the RBI (to tighten monetary policy) may be required," PMEAC chairman C Rangarajan told PTI.

His remarks came even as inflation, though down marginally from December, continued to be above 8%, a level where it has stood at since January 2010.

The RBI has already hiked its short-term lending and borrowing rates by 25 basis points in its third quarterly review last month to tame inflationary pressure. The apex bank has also termed inflation control as its topmost priority.

Asked about the fall in inflation numbers in January, Mr Rangarajan said: "In some ways, it was expected. We can see inflation falling to 7% by March."

At last month's review, the RBI had revised its inflation estimate to 7% by March-end, from the earlier 5.5%.

Inflation declined marginally to 8.23% in January from 8.43% in the previous month, as prices of certain commodities like wheat, pulses and sugar eased, although essential items like onions and other vegetables continued to remain firm.

Besides, food items, many experts have also voiced concern over global crude prices which had crossed a 28-month high at $102 per barrel on account of political instability in the Middle-East, especially Egypt.

Meanwhile, finance minister Pranab Mukherjee has expressed hope that the overall inflation will come down to 7% by March end.

"I am hoping that it (inflation) would be roughly around 7% (by March end). I hope so. But I cannot firmly commit it," Mr Mukherjee told reporters here.

The overall inflation has shown a marginal decline to 8.23% in January, from 8.43% in the previous month.

The finance minister, however, said the inflation numbers in the coming months would depend on global developments and the way the commodity prices move in the global markets.

Mr Mukherjee attributed the decline in January inflation to monthly variations and said the fall was on expected lines.

"Don't go by the weekly fluctuation or monthly fluctuations. This was expected. It is nothing unusual," he added.

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Mahindra Satyam Q3 net up two-fold to Rs58.9 crore

Mahindra Satyam had reported a net loss of Rs1,250 crore for the year ended March 2010, giving a first view of its financials almost two years after founder B Ramalinga Raju admitted to cooking the company's account books for years

MUMBAI: Mahindra Satyam, formerly known as Satyam Computer Services, today reported an over two-fold sequential jump in consolidated net profit for the quarter ended 31 December 2010, to Rs58.9 crore, up from Rs23.3 crore for the July-September quarter of 2010, reports PTI.

Revenue for the third quarter grew marginally to Rs1,279.3 crore from Rs1,242 crore in Q2, FY2010-11, Mahindra Satyam said in a filing to the Bombay Stock Exchange.

Mahindra Satyam had reported a net loss of Rs1,250 crore for the year ended March 2010, giving a first view of its financials almost two years after founder B Ramalinga Raju admitted to cooking the company's account books for years.

"Our efforts of investing in core competencies have begun to show encouraging results. The recognitions that we have received from our partners are true reflections of our inherent capabilities... Mahindra Satyam is geared up for a promising year of growth and opportunities," Mahindra Satyam chairman Vineet Nayyar said.

In January 2009, former chairman and founder Ramalinga Raju had confessed to perpetrating a multi-crore scam wherein the company's profits were overstated and its assets falsified.

Tech Mahindra took over Satyam in April 2009 and is operating it as an independent company.

The company had 217 clients at the end of 31 December 2010. Its consolidated cash and cash-equivalent reserves stood at Rs3,048 crore for the reporting quarter.

The headcount of the company at the end of the third quarter was 28,832, an increase of 764 personnel from 28,068 employees as at the end of September 2010.

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WPI inflation for January eases marginally to 8.23%

The easing of inflation is expected to come as a morale booster for the government and the RBI, which have been under pressure due to high prices of food items in recent months

New Delhi: The wholesale price index (WPI) based inflation declined marginally to 8.23% in January from 8.43% in the previous month, as prices of certain commodities like wheat, pulses and sugar eased, even as essential items like onion and other vegetables continue to remain dearer, reports PTI.

The headline inflation, based on wholesale prices, has remained above the 8%-mark since January 2010.

The fall in inflation has been mainly on account of declining prices of sugar (down 14.99%), pulses (12.78%), wheat (4.94%) and potato (1.21%).

However, vegetable and fruits continued to remain expensive. On an annual basis, vegetable prices rose by 65% and onion prices nearly doubled. Also, fruits became costly by 15.01% and eggs, meat and fish by 15.09%.

Overall, primary articles became costly by 17.28% with food articles rising 15.65%.

In the non-food articles category, fibre prices rose by 48% on an annual basis.

Prices of fuel and power shot up by 11.41%, with petrol rising 27.37% on a year-on-year basis.

However, among manufactured items, sugar prices fell by 15%, while edible oils turned costlier by 7.16%.

The inflation number for November has also been revised upwards to 8.08% from 7.48%, according to government data released today.

The easing of inflation is expected to come as a morale booster for the government, which have been under pressure due to high prices of food items in recent months.

It also shows that Reserve Bank of India's (RBI) action of raising rates seven times since March 2010 has started showing some results.

It may be recalled that food inflation, which accounts for over 14% in the overall wholesale price index (WPI) inflation, has remained high since December scaling up to 18.32%.

At its third quarterly review last month, the RBI revised its inflation estimate to 7% by March-end, from the earlier 5.5%.

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