Coimbatore, February 4:Admitting that inflation triggered by foodgrain price rise did not moderate as expected by the government, C Rangarajan, Chairman, Economic Advisory Council to the Prime Minister, today said managing inflationary risk was the biggest challenge in the short run.
Inflation was triggered by the increase in foodgrain prices and the government expected that it would moderate in 2011 but this did not happen, he said here.
However, he said the 8.43 per cent year-on-year inflation, as measured by Wholesale Price Index as of December, 2010, was expected to come down to around seven per cent by March 2011.
Delivering the G K Sundaram Endowment Lecture organised by South India Cotton Association, he said managing inflationary risk, particularly foodgrain price inflation, was the biggest challenge in the short run as "we had two years of high inflation.
--PTI
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