Inflation | featured news

India's economic growth surged in the third quarter at a much faster pace than expected, increasing odds that the central bank will raise interest rates to head off inflation.

Inflation pressures remained modest in the month even though gasoline prices edged higher, the government reported.

Consumer prices were flat in July as energy costs retreated following a big surge in June. Over the past 12 months, prices dropped the most in nearly six decades as the recession and lower energy costs kept a lid on inflation.

The 0.7 percent pace in June was slightly faster than expected, but the core inflation measure remained relatively tame.

The docile inflation performance reflected a second monthly drop in energy costs and a third consecutive decline in food prices.

Consumer prices dipped unexpectedly in March, leaving prices over the past year falling at the fastest clip in more than a half-century. The recession is expected to keep a lid on inflation as widespread layoffs dampen wage pressures and weak demand keeps companies from raising prices.

Warren Buffett said on Monday the U.S. economy had "fallen off a cliff" but would eventually recover, although a rebound could kindle inflation worse than that experienced in the late 1970s.