India Inflation Rate

The inflation rate in India was last reported at 9.3 percent in January of 2011. From 1969 until 2010, the average inflation rate in India was 7.99 percent reaching an historical high of 34.68 percent in September of 1974 and a record low of -11.31 percent in May of 1976. Inflation rate refers to a general rise in prices measured against a standard level of purchasing power. The most well known measures of Inflation are the CPI which measures consumer prices, and the GDP deflator, which measures inflation in the whole of the domestic economy. This page includes: India Inflation Rate chart, historical data and news.
Country Interest Rate 5.50% Growth Rate 8.90% Inflation Rate 9.47% Jobless Rate 8.00% Current Account -16 Exchange Rate 45.3300

India

Year 2011 2010 2009 2008

Jan 9.30 16.22 10.45 5.51

Feb Mar

Apr

May Jun

Jul

Aug

Sep

Oct

Nov

Dec

14.86 14.86 13.33 13.91 13.73 11.25 9.88 9.82 9.70 9.63 8.03 8.70 8.63 9.29 11.89 11.72 11.64 11.49 5.47 7.87 7.81 7.75 7.69 8.33 9.02 9.77 10.45

8.33 9.47 13.51 14.97 10.45 9.70

* The table above displays the monthly average

(Source:http://www.tradingeconomics.com/Economics/InflationCPI.aspx?Symbol=INR)

India Interest Rate

The benchmark interest rate (reverse repo) in India was last reported at 5.5 percent. In India, interest rate decisions are taken by the Reserve Bank of India's Central Board of Directors. The official interest rate is the benchmark repurchase rate. From 2000 until 2010, India's average interest rate was 5.82 percent reaching an historical high of 14.50 percent in August of 2000 and a record low of 3.25 percent in April of 2009. This page includes: India Interest Rate chart, historical data and news.

Country

Interest Rate 5.50%

Growth Rate 8.90%

Inflation Rate 9.47%

Jobless Rate 8.00%

Current Account -16

Exchange Rate 45.3300

India

Year 2011 2010 2009 2008

Jan 5.50 3.25 4.50 6.00

Feb 3.25 4.00 6.00

Mar 3.38 3.75 6.00

Apr 3.63 3.38 6.00

May 3.75 3.25 6.00

Jun 3.75 3.25 6.00

Jul 4.08 3.25 6.00

Aug 4.50 3.25 6.00

Sep 5.00 3.25 6.00

Oct

Nov 5.25 3.25 6.00

Dec 5.25 3.25 5.50

3.25 6.00

* The table above displays the monthly average.

(Source:http://www.tradingeconomics.com/Economics/InterestRate.aspx?Symbol=INR)

 DataaboutDifferentcountriesandrelatedindexescanbedownloadedfrom 1. http://www.imf.org/external/index.htm 2. http://mospi.nic.in/Mospi_New/site/home.aspx 3. http://eaindustry.nic.in/ OtherusefuldataonDerivativesandInflationcanbeaccessedfromhere 1. http://www.derivativesindia.com/scripts/infuture/index.asp 2. http://www.tradingeconomics.com/india/indicators/ 3. http://www.rediff.com/getahead/slideshow/slideshow1moneysixfactsyoumustknow aboutinflation/20110218.htm 4. http://en.wikipedia.org/wiki/Inflation_derivative 5. http://en.wikipedia.org/wiki/Inflationindexed_bond 6. http://www.investopedia.com/terms/i/inflationderivative.asp 7. http://blog.nobletrading.com/2008/10/whatareinflationderivatives.html 8. http://en.wikipedia.org/wiki/Inflation(OnlyEffectsandCausesPart) Apartfromthatyouwillbeprovidedwithrelateddataandmathematicaltoolstouseduringpreparing the solution for the case questions. (Check Events page for Downloading Materials, www.thedimension.org)

CASESTATEMENT
We have presented above the related reports and figures to show that inflation plays an importantroleindecidingfuturedirectionofeconomy.Inflationalsodirectlyaffectsnormalhousehold. Latest trends in India have shown that the inflation rate continues to be unpredictable, it will give immensepressureontheconsumptionofdifferenttypeofitemsespeciallyfooditems.Frompointof consumption,onecansuggesttohedgeoneselffromthisunpredictableinflationrate.RBIistakingsteps intermsofchanginginterestrates.Onewaytodosoistobuyinginflationderivative.Itisaninstrument withaproducerorconsumerpriceindexusedasthebasisforaswaporotherindexratepayment.It transferinflationrisefromonepartytoothercounterparty.Forexample,onecouldevenhedgeoneself frominflationratebybuyinginflationderivative,inflationlinkedgovernmentbond.So,wepresentto youthetaskofhedgingusfromINFLATION!!! Organiser:FinancialModelling,DIMESNION2011