Interest rate decision will depend on inflation situation: RBI
Quotes

Interest rate decision will depend on inflation situation: RBI

Last Updated: Thursday, August 16, 2012, 15:25
 
 Comment 0
 
Interest rate decision will depend on inflation situation: RBI
New Delhi: The Reserve Bank Thursday said it will assess if the declining trend in inflation is sustainable and accordingly take decision on reducing interest rate.

Inflation based on Wholesale Price Index (WPI) declined to 6.87 percent in July, from 7.25 percent in June. Still, it is much above the RBI's 5-6 percent comfort level.

However, with the easing of inflation and contracting industrial output, the industry is clamouring for reduction in interest rate to spur growth.

"Interest rates to fall when inflation drops...(RBI) will assess if the inflation fall is sustainable," RBI Deputy Governor K C Chakrabarty told reporters after meeting Economic Affairs Secretary Arvind Mayaram here.

He said 5 percent inflation is India's comfort zone.

The Reserve Bank is scheduled to review its monetary policy on September 17.

In its monetary policy review last month, RBI had kept key interest rate (repo rate) unchanged at 8 percent in view of high inflation.

After taking charge of the Finance Ministry this month, P Chidambaram had said that high interest rates "inhibit the investor and are a burden on every class of borrowers".

He had said steps would be taken to bring down interest rates.

PTI



First Published: Thursday, August 16, 2012, 15:25


Comments


comments powered by Disqus
Google I/O 2014
Google I/O 2014
Maker Faire @ White House
Maker Faire @ White House
Amazon unveils 3D `Fire` smartphone
Amazon unveils 3D `Fire` smartphone
RIL`s 40th AGM
RIL`s 40th AGM
Samsung Galaxy Tab S
Samsung Galaxy Tab S

Web Wrap
Contact Us : Privacy Policy : Legal Disclaimer
Copyright © Zee Media Corporation Ltd. All rights reserved