India’s inflation rate is likely to decline to 4 percent in 2024 as stated by the IMF
It is anticipated that India’s inflation rate will drop from 6.8% in the current fiscal year., ending on March 31 to a significant 5 percent in the next fiscal year. It has been predicted that the inflation rate would decrease further to 4 percent, according to the International Monetary Fund.
Daniel Leigh, Division Chief working in the Research Department of IMF, has stated that India’s inflation rate will meet a target of 4 percent by the end of 2024.
The consequences are reflected by the steps taken by the Central Bank to curb inflation. The data from the World Economic Outlook that was released by the International Monetary Fund has stated that about 84 percent of the countries are predicted to have lower consumer price index inflation in 2023 than in 2022.
Furthermore, the global rate is predicted to decrease from 8.8 percent to 6.6 percent in 2023 and 4.3 percent in 2024 to attain the pre-pandemic level.
The reduction in the rates has contributed to the decline in fuel and non-fuel commodity prices due to the decreasing global demand. It implies a cooling effect on the monetary tightening policy on the persisting inflation, which will decrease further at a tremendous rate.
However, disinflation will take time as the annual average headline and the core inflation will be at higher levels of 82 and 86 percent respectively.
On the contrary, in advanced economies, it is anticipated that the yearly average inflation will drop from 7.3% in 2022 to 4.6% in 2023 and 2.6% in other circumstances.
On the other hand, the trend will visualize a decline from 9.9 percent to 8.1 percent in 2023 and 5.5 percent in 2024, which is still slightly above the pre-pandemic levels.
In developing and low-income nations, the inflation rate will vary from 14.2 percent in 2022 to 8.6 percent in 2024. The value is still high but is close to the pre-pandemic levels, as stated by the IMF.
Chief Economist and Director of the Research Department of the IMF has discussed the declining trends in inflation, stating that global inflation will decline in many countries by the end of 2024. However, the projected average annual headline and the core inflation will still account for a higher value in more than 80 percent of the countries.
He added that the news in many countries is encouraging, but the battle has not been conquered yet. Monetary policy has started to slow new home construction in many countries. But, the inflation-adjusted interest rates have remained considerably low or negative in the European economies, which is of concern.
In addition, the rate and efficacy of the global monetary tightening policy are unpredictable, making the fight against inflation difficult.
The Chief Economic Advisor (CEA) V. Anantha Nageswaram, has talked about the matter, stating that India is expected to attain a poised growth of 6.5 to 7 percent by the end of the decade. He has even added that inflation will stay in control during the fiscal year 2023-24. The Economic Survey has further stated that the RBI’s projection of 6.8 percent inflation is neither too high to impact private consumption nor too low to weaken investment opportunities.
India’s economic growth is predicted to slow down in the fiscal year starting from April but will be the fastest-growing economy in the world. It has a chance to endure the challenges that the world is presently facing, as stated by the Economic Survey.
He has further added that as long as the oil barrels’ prices remain controlled, India’s growth rate will be undisturbed. He has implied that the quality of public expenditure has increased, and the Indian government has become more transparent in handling the budget deficit values.
India’s growth rate is incomparable to other G20 countries in terms of GDP increase and decline in inflation:
India currently has a robust economy and is a bright spot in the world. India is expected to develop at a rate of 6.7 percent in 2024, the highest growth rate among the G20 countries. The U.N. economist made the announcement.
The head of the U.N. Department of Economic and Social Affairs’ Economic Analysis and Policy division’s Global Economic Monitoring Branch has made the remarks.
Rashid has said that he believes India is currently stable in the global economy.
According to the research, India’s GDP will increase to 5.8 percent in 2023. It has happened due to rising interest rates and a slowdown in exports and investments worldwide.
edited and proofread by nikita sharma
