Inflation to be in 2-3% band in coming yrs: Mohan

Rakesh Mohan, Deputy Governor of Reserve Bank of India (RBI), today said he expects the average annual inflation to come down to 2-3% in the coming years.

"Since the late 1990s, the average inflation has come down to 4-5%. Hopefully, it will come down further as we are looking at 2-3%," Mohan said.

There has been a significant reduction in inflation, which averaged 7-8% during late 1950s to 1990s, Mohan said. Inflation shot up to about 7% last year mainly due to high oil prices, and there were "reactions" from various quarters expressing concern on the high price levels.

"The reactions suggest people feel that 7% inflation is not acceptable. It seems people's expectation have increased," he said.