Inflation in developing markets, including India, has been ruling high for the past year. In India, the Reserve Bank of India (RBI) has taken some steps admitting tightening monetary policy and increasing interest rates six times to hold inflation.

These are some of the direct and alternative implications of a higher inflation rate. The RBI has already done multiple rounds of monetary policy tightening.

Food inflation touched a 52-week high level and analysts believe that it shall soon spread to a greater basket of items and effect in advanced Wholesale Price Index (WPI)-based inflation.

The inflation rate dropped towards the second half of last year, simply the price of food articles and many important commodities have again started moving up last month. The interest rates have already gone up a pair of percentage points across the panel.

It is quite probable that RBI may raise the interest rate in its policy review due towards the end of this month.