India's annual inflation rate hits 7.61 percent; Govt. bans future trading in essential commodities

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The annual inflation rate was 6.01 percent during the corresponding period of the previous year.

To battle inflation, the government has announced a slew of fiscal measures like scrapping import duty on crude edible oils and banning export of non-basmati rice and pulses even as it urged steel and cement producers not to raise prices.

This week, the government also banned futures trading in rubber, chana, potato and soya oil for four months in an attempt to contain the price rise in essential commodities.

India's central bank, the Reserve Bank of India (RBI) has also tightened cash conditions for the second time in less than a month, by raising its cash reserve ratio (CRR) by 25 basis points (0.25 percent) to 8.25 percent with effect from May 24 while keeping other official rates intact.

In a bid to drain out excess liquidity from the market, the RBI had already announced a hike in the CRR, or the proportion of reserves the banks must keep with the central bank, on April 17, raising the ratio to 8 percent in two stages of 25 basis points each.

The first increase has already taken place and the second is effective on May 10.

While the bank said inflation figures would be pushed back to "around 5.5 percent" this fiscal with the goal of lowering it to 5 percent as soon as possible, India's premier economic research institution, National Council for Applied Economic Research (NCAER) has forecast that India's inflation, currently over 5.5 percent, would come down to settle in a range of 4.9-5.2 percent for the current fiscal year.

According to market analysts, India is still having relatively moderately low inflation than the global inflation. If one looks at China, Taiwan or anywhere in the US, inflation is much higher than what it is in India, they said.

Philippine inflation accelerated at 6.4 percent from a year earlier, the fastest pace in 20 months in March, a report showed. China, Indonesia and Pakistan all have inflation rates of more than 8 percent. Sri Lanka's was 23.8 percent in March.