Deprecated (16384): The ArrayAccess methods will be removed in 4.0.0.Use getParam(), getData() and getQuery() instead. - /home/brlfuser/public_html/src/Controller/ArtileDetailController.php, line: 150
 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php. [CORE/src/Core/functions.php, line 311]
Deprecated (16384): The ArrayAccess methods will be removed in 4.0.0.Use getParam(), getData() and getQuery() instead. - /home/brlfuser/public_html/src/Controller/ArtileDetailController.php, line: 151
 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php. [CORE/src/Core/functions.php, line 311]
Warning (512): Unable to emit headers. Headers sent in file=/home/brlfuser/public_html/vendor/cakephp/cakephp/src/Error/Debugger.php line=853 [CORE/src/Http/ResponseEmitter.php, line 48]
Warning (2): Cannot modify header information - headers already sent by (output started at /home/brlfuser/public_html/vendor/cakephp/cakephp/src/Error/Debugger.php:853) [CORE/src/Http/ResponseEmitter.php, line 148]
Warning (2): Cannot modify header information - headers already sent by (output started at /home/brlfuser/public_html/vendor/cakephp/cakephp/src/Error/Debugger.php:853) [CORE/src/Http/ResponseEmitter.php, line 181]
LATEST NEWS UPDATES | Is the Indian economy staring at stagflation? -Prashanth Perumal J

Is the Indian economy staring at stagflation? -Prashanth Perumal J

Share this article Share this article
published Published on Jan 19, 2020   modified Modified on Jan 19, 2020
-The Hindu

Why is the scenario of rising prices and falling growth a cause for worry? Can the government or the Reserve Bank of India do anything?

The story so far: The rise in retail price inflation to a nearly six-year high of 7.35% in December has led to increasing worries that the Indian economy may be headed towards stagflation. The current rise in retail inflation has been attributed mainly to the rise in the prices of vegetables such as onions. Still, the steady rise in wider inflation figures over the last few months amidst falling economic growth has led to fears of stagflation. Notably, former Prime Minister Manmohan Singh writing in The Hindu in November had warned about the imminent risk of stagflation facing the economy.

* What is stagflation?

Stagflation is an economic scenario where an economy faces both high inflation and low growth (and high unemployment) at the same time. The Indian economy has now faced six consecutive quarters of slowing growth since 2018. Economic growth in the second quarter ending September, the most recent quarter for which data is available, was just 4.5%. For the whole year, growth is expected to be around 5%. Most economists have blamed the slowdown on the lack of sufficient consumer demand for goods and services. In fact, insufficient demand was cited as the primary reason behind the low price inflation that was prevalent in the economy until recently. Subsequently, the government and many analysts prodded the Reserve Bank of India (RBI) to cut interest rates in order to boost demand. This led to significant friction between the government and the RBI that led to the exit of several top-ranking officials (including the RBI’s former Governor) from the central bank. Eventually, the RBI under Governor Shaktikanta Das obliged by cutting its benchmark interest rate, the repo rate, five times in 2019.

Please click here to read more.

The Hindu, 19 January, 2020, https://www.thehindu.com/business/Economy/is-the-indian-economy-staring-at-stagflation/article30595793.ece?homepage=true


Related Articles

 

Write Comments

Your email address will not be published. Required fields are marked *

*

Video Archives

Archives

share on Facebook
Twitter
RSS
Feedback
Read Later

Contact Form

Please enter security code
      Close