India, much like the rest of the world, is grappling with rising consumer price inflation, and food price inflation in particular. Already clocking in at 7% year on year, India’s Consumer Price Index is forecast to rise to 7.3% for the month of September, and the bias trend in the forecast suggests further increases beyond that.
Forecasts for the data, due at 1200 GMT on Oct. 12, ranged between 6.60% and 7.80%. Some 91% of economists, 43 of 47, expected inflation to be 7.00% or higher, suggesting the bias was for prices to go up further.
"There is a strong pressure from food that is playing out. What is even more worrying is the cereals and pulses inflation which has remained low for quite some time, will rise at an unprecedented pace," said Dharmakirti Joshi, chief economist at Crisil.
At least the Indian economists appear to recognize that monetary policy is ineffective against inflation that is being driven largely by supply-side issues.
"Will monetary policy action be able to contain it? Very honestly, it will not. It will arrest inflation expectations from moving on to the higher side, but fiscal policy has a greater role to play."
Of course, when food imports from areas such as Ukraine are disrupted due to externalities such as war, even fiscal policy can do little to change a supply situation where the supply simply is not there.
The linkages that have bound the global economy together for the past few decades are coming undone, a process of rupture that began with the pandmic-inspired lockdowns of 2020. Those ruptures are the broad forces that are driving prices up for nearly everything nearly everywhere. You can’t paper that over with money, nor plate it over with gold.
 I just wish there were honest competent people in Congress and the Fed.
Those in charge of monetary policy and those in charge of fiscal policy are locked into a steel cage. Only one faction will emerge alive.
Here in the US that reality is denied by both factions.