India Inc Expects Inflation To Flare Up Further: Mckinsey

As if inflation at its highest level in about three years was not enough, nearly two-third of executives in India expects the rate of price rise to further flare up in the next six months, according to a new survey.

However, this pessimism level regarding the inflation among the Indian executives is much lower when compared to the places like China, Europe, North America, other developing markets and the overall Asia-Pacific region. According to the report titled "Economic and Hiring Outlook, First Quarter 2008: A McKinsey Global Survey," as many as 64 per cent of Indian executives expect the rate of inflation to rise in the next six month, while only 20 per cent expect a decline in the rate of price rise.

About 15 per cent of Indian executives expect the inflation rate to remain unchanged in the next six months, the survey found.The survey was conducted in March, presumably before the government data showing the rate of inflation at 7 per cent was released on April 4.

According to the survey, the percentage of executives expecting a rise in rate of inflation is less than India only in Latin America, where 58 per cent said they expected it to rise in their country from current levels in the next six months.