watched. most important, there is a reassurance that in the context of current rise in inflation all are on the same side, viz., on the side of price stability. the fiscal authorities, monetary policy, the financial markets and corporates are committed to the objective of price stability and minimising volatility. in this background, therefore, rbi will continue its dialogue with market participants to fine tune its response to minimise volatility while emphasising the importance of reserve bank ’ s credibility in maintaining price stability consistent with the compulsions of the growth dynamics in our country at this juncture. thank you.

came forward from the banking community and the financial sector is to try and reduce volatility. all of them agreed that it is in the interest of everybody that we minimise volatility in the financial markets and in public policy minimise knee - jerk reactions, while focussing on price stability and the underlying inflation. fourth, in the domestic circumstance, there is a truckers ’ strike and there are fears of strike adding to inflation. it must be recognised that there may be some increase in the numbers relating to headline inflation for those few weeks. i would, however, describe the truckers ’ strike to be in the nature of a “ temporary supply disruption in certain localities ” rather than something that should influence the inflationary expectations or the approach to price stability. it is this distinction that is required when we are analysing the type of policy responses. fifth, as far as the financial markets are concerned, the money markets have been reasonably stable and the forex markets have also been stable. in the government securities market, however, there have been certain concerns. the rbi is aware of the situation and the market participants have made several suggestions to minimise volatility or adverse impact, and these are being examined at the operational level. we in rbi are trying to see that there are no avoidable uncertainties in policy, while mitigating undue pressures on the functioning of markets without undermining market efficiency. positives getting more positive but in all this, while it is true that we should be concerned about the current rise in headline inflation, we should not forget the positive side, and in my view, the positive side seems to be getting a bit more positive in the last two - to - three weeks. how is that so? first and foremost, there is virtually a national consensus that high inflation is not good and that it should be brought down. whether it is political leadership, whether it is economic agents, whether it is bankers, whether it is regulators - among everybody there is a national consensus that it is not good to have persistent highs in prices and that everybody should consider the common long - term interests in maintaining price stability. so, there is a national consensus on the issue and several actions have followed from all sections wherever it was warranted and there have been no knee - jerk reactions. second, there is good news, in the sense that generally in india democratic pressures ensure that the inflation doesn ’ t go above the two - digit mark. but now, we