Inflation Rate in India 2010

[Image Source: Sulekha.com]

Inflation Rate in India 2010

RBI has tighten its monetary policy to control the higher inflation. In September 2010, overall inflation in India was 8.62% which was much higher than the RBI expectations.

And that’s why RBI is planning to increase the various key rates to cool down the inflation. Hopefully by December, 2010, the inflation rate will come down to 6%.

Food inflation was 13.75 per cent for the week ended October 16. It has remained in double digit for the past three months.
RBI also noted that credit to non-food sectors was healthy, although loan disbursals to the agriculture sector had declined.

Inflation is a silent wealth killer. It shrinks the purchasing power of your wealth silently and that’s why saving money is the worthless financial advise now. You should save and invest your money in the modern world.

You should invest your money in assets which give you at least 2% higher returns than the inflation rate. So according to the current inflation rate (8.50%), you should invest in assets which can give you 10%+ annual returns.

And that’s why fixed income instruments like PPF, Bank FDs, Post-office savings schemes…etc.. are practically worthless. Smart investors invest their money in private businesses, web properties, equities and gold to beat the inflation.

So be a smart investor and invest your money in higher growth assets. PPF, bank FDs and Post office savings schemes are no more safe because inflation erodes the purchasing power of your money parked in these fixed income instruments.