New Delhi: Inflation is expected to fall in the range of 6.2 to 6.6 per cent in March this year, helped by moderation in non-food manufacturing sector and global commodity prices, according to the Economic Survey 2012-13 released Wednesday.
The core inflation based on the whole price index (WPI) has remained muted in the current financial year and declined to a three year low of 6.62 per cent in January 2013.
"The recent increase in onion prices in January 2012 and revision in diesel prices may put some pressure on headline inflation. However, inflation is expected to continue the moderating trend," said the annual document presented in Parliament by finance minister P Chidambaram.
Addressing a press conference after the release of the annual Economic Survey, chief economic advisor to finance ministry Raghuram Rajan said high food inflation remain a worry for the policymakers.
Unlike last year when the food price inflation was mainly driven by higher protein food items, this year the pressure has been mounting in cereals.
The survey authored by Rajan points out that inflation has eased in almost all major advanced and emerging market economies in the current year.
"The positive effect of continuous policy easing by the major advanced and developing countries could pose a higher risk to inflation expectations. However, in the short run, given weak growth sentiments, the impact of policy easing may not lead to a surge in inflation and inflation expectations may remain anchored around current target inflation rates," the survey said.
As per the World Bank, except for metals, most global commodity prices are expected to decline further in 2013 and 2014.
"The impact of benign inflationary expectations internationally will have a moderating impact on domestic prices," it said.
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