Comparing the Headlines about price levels

THE World

• Last week, World Bank Chief Economist Justin Lin warned in a speech that a surge in excess capacity world-wide could lead to a global "deflationary downward spiral."

• The Bank of Japan and the International Monetary Fund are forecasting two years of price declines in Japan, which suffered a serious bout of deflation in the 1990s because of a blowup in its banking sector and collapse in the real-estate market.

• China's consumer-price index was down 1.1% from a year ago, and its producer-price index fell 5.9%, according to China's National Bureau of Statistics from last week.

INDIA




India’s wholesale prices fell for a sixth straight week, suggesting the Reserve Bank of India (RBI) is unlikely to start increasing interest rates at a meeting next week.

The benchmark Wholesale Price Index declined 1.17% in the week to 11 July from a year earlier after falling 1.21% in the previous week, the government said on Thursday. Prices retreated 1.61% in the first week of June, the biggest drop since December 1978, according to RBI data.





NEPAL

• The new Monetary Policy that the central bank is announcing on Friday will have no major policy-level changes to check galloping inflation, the highest in 17 years.

• Despite a written demand put forward by the banking community, the policy is making no changes in the Cash Reserve Ratio (CRR) and the Bank Rate, major policy rates that can alter liquidity in the market, thereby influencing both deposit and lending rates. Currently, NRB maintains CRR and the Bank Rate at 5.5 and 6.5 percent respectively.