We cannot continue to reduce policy rates every time: Shaktikanta Das
MUMBAI: After surprisingly maintaining rates, the governor of the Reserve Bank of India (RBI) Shaktikanta Das said Thursday that he cannot continue to mechanically reduce interest rates every time.
Das said the central bank will wait for the impact of coordinated measures taken by the government and the RBI in recent months to boost growth before accepting rates.
Official data showed that growth has fallen to a minimum of more than six years by 4.5 percent in the second quarter, and the RBI also drastically reduced its estimate for fiscal year 2016 to 5 percent, a total of 110 bp from its October review, which again was a downward revision of the basic points (bp) of the August evaluation.
The sharp decline in growth had many analysts assuming that the RBI will deliver a rate cut on Thursday.
He also noted a line in the resolution of the monetary policy committee, which makes it explicitly clear that there is scope for further rate cuts.
Das said there are green outbreaks in the economy, but that it is too early to call for sustainability, he said that recent measures initiated by the government will help revive the sentiment and stimulate domestic demand, which is attributed to the main reasons of the slowdown. .