India has witnessed significant disinflation since 2012–13 – with headline CPI inflation moderating from an annual average of 10.0 per cent in 2012–13 to 3.6 per cent in 2017–18 and 3.7 per cent in 2018–19 so far (April-December). As per the latest reading, headline inflation stood at a low of 2.2 per cent in December 2018.
Such policies will help the real economy to overcome financing challenges and fully benefit from our very accommodative monetary policy. Growth in the euro area can also benefit from the completion of the single market in services. If the right policies are implemented, the euro area could significantly increase its growth potential.