India’s government on Thursday halted trading in futures contracts for key staple foods and for rubber as it battled to avoid an election drubbing due to high inflation.
The government suspended futures trade in basic foods such as chickpeas, soybean oil and potatoes for four months, saying the move was aimed at stopping price rises driven by speculators. It also halted futures trade in rubber.
The ruling Congress-led coalition said more efforts were also underway to fight inflation in Asia’s third-largest economy, as cement producers Thursday joined steelmakers in pledging price cuts. The election is seen as a bellwether of popular discontent over inflation running at a 42-month high of 7.57 percent despite aggressive monetary tightening, which has pushed interest rates to six-year highs.
India’s hundreds of millions of poor — whose electoral support is vital — have been hit hardest by the surge in inflation, which has more than doubled since last November.