Also, as I had indicated earlier, because of the narrowing of the output gap, producers were able to pass on higher input prices to higher output prices leading to inflationary pressures getting generalized as evidenced by the increase in non-food manufactured product inflation from 5.3 per cent per cent in August 2010 to 8.5 per cent in March 2011.
We responded to these changes in underlying drivers of inflation by tightening more aggressively starting May 2011. 16. The second factor relevant in the “behind the curve” debate is that we also had to contend with an uncertain global recovery.