View Full Version : Cabinet approoved additional 5% DA w.e.f 01.07.09

10-09-2009, 03:49 PM
Just now Cabinet approoved additional 5% DA w.e.f 01.07.09.

10-09-2009, 04:27 PM
how come on one hand govt says inflation is negitive and v get 5%da?neverthe less good news at right time

10-09-2009, 05:30 PM
how come on one hand govt says inflation is negitive and v get 5%da?neverthe less good news at right time
Can anybody explain how the inflation is arrived at? The prices of essential commodities like rice, wheat, pulses are skyhigh and yet the inflation is at negative.

10-09-2009, 08:00 PM
Jul-08 143
Aug-08 145
Sep-08 146
Oct-08 148
Nov-08 148
Dec-08 147
Jan-09 148
Feb-09 148
Mar-09 148
Apr-09 150
May-09 150
Jun-09 150
total 1771
average 147.5833333
base 115.76
%da 27.49078553 = ((avg index-base index)/base index) x 100

Is it o.k.?

10-09-2009, 08:20 PM
jokes apart, inflation is a measure of buying capacity. When the buying capacity is more and the demand is also there, inflation tends to be on the higher side. When the buying capacity is less the demand comes down and added to that when the cost of the articles are high the demand is driven down further. This gives rise to negative inflation (deflation?). We are going through that phase now I think. Does the reversal of the inflation from negative to positive means that the recession is flattening out if not reversing?
Am I correct on the inflation?

11-09-2009, 11:16 AM
i thought the indices part is ok-

but i was wondering if you see the history of da releases for the past 7 yrs or so, you will find that highest 6 monthly instalment of da has been 6% and the lowest 3%,where as for most of the time inflation was near 7-8%.

for the last one year inflation was below 1% or negitive and still 5%da is given and the prices too are going thru the roof

its got something to do with wholesale price index and consumer price index i beleive

not out of place to recall that what statistics reveals is substantial but what it conceals is vital(a la a two piece bikini)

13-09-2009, 10:55 AM
Ofcourse, the WPI does play a part in the calculation of the DA. The details of them month wise was earlier given in the table.

I believe, while those are the technical statistics which go in the determination of the DA, the physical/ psychoological side of the economics get into the demand-supply situation and give a lopsided view. regards.

15-09-2009, 09:34 AM
MoF/DoPT has not issued any OM/notification for 5% day released last week by the Cabinet yet. Please clarify.