Economy Won''t Slip Into Deflation: Montek - March 27, 2009

The Indian economy is not heading towards deflation despite of inflation heading towards zero level, said Montek Singh Ahluwalia, Planning Commission Deputy Chairman The inflation rate dropped to 0.27 per cent for the week ended March 14 from 0.44 per cent for the week ended March 7.I don''t think we are heading towards deflation. It is true that inflation rate has come down...this is because at this time last year, there was a sharp increase in prices, Ahluwalia told. He also said that inflation can go to zero or may even be negative for a week or two. It has happened in the past...during 1970s the inflation rate became negative for a brief period. But I don''t expect that there would be deflation at all now.