TOI reported that global investment banker Barclays Capital has projected that Indian inflation may surge to 17% by September 2008, on back of another round of hike in fuel prices in September 2008.
The report said that "We believe WPI inflation will remain in double digit territory until May 2009. We expect WPI inflation of 17% by September 2008. The government is likely to hike fuel prices between 10% and 20% again as early as September 2008 to limit fiscal risks.”
The report further added that rise in the price of Indian crude oil basket to USD 145 per barrel to USD 150 per barrel from the current USD 132 per barrel could be the trigger for another round of increase in fuel prices.
Indian government last revised retail petroleum prices with effect from June 5th 2008 when petrol prices was up by INR 5 per liters, diesel by INR 3 per liters & cooking gas up by INR 50 per cylinder. This resulted in inflation touching a double digit figure of 11.05% for the week ended June 7th 2008.
