Concurrently, the global economy made a sharp recovery from the recession of 2009. As a result, global commodity prices including oil rose substantially. India being a net commodity importer, particularly oil, the intermediate prices rose. This quickly spilled over to non-food manufactured products inflation, making the inflation process fairly generalised.
The mandate to maintain price stability has been assigned as its primary objective to the European System of Central Banks (ESCB), which is independent of political instructions. The ESCB has been equipped with all the powers and instruments needed to pursue an effective monetary policy. At the same time, the ESCB is prohibited from any monetary financing of public-sector budgets.