Reserve Bank of India: Reserve Bank of India (RBI) Governor Shaktikanta Das said that now is not the right time to cut interest rates. Inflation has increased in the country. There does not seem to be any scope for further reduction in this. In such a situation, we cannot take the risk of reducing interest rates. RBI had announced to keep the interest rates stable in the Monetary Policy Committee (MPC) meeting held this month. After the US Federal Reserve cut interest rates, everyone expected that the RBI could also do the same. But, the central bank surprised with its decision.
Keeping a close eye on inflation rate, waiting for it to slow down
Speaking at the Bloomberg India Credit Forum, RBI Governor Shaktikanta Das said on Friday that reducing interest rates now could lead to a crisis. For this we will have to keep a close eye on the inflation rate. If your economic growth rate is good then there is no need for any change in it at present. If the inflation rate remains around 4 percent then we will seriously consider reducing interest rates. There is no need for us to guess about this. We should wait for the data.
Next 6 months very sensitive in terms of inflation
According to Shaktikanta Das, the next 6 months are very sensitive in terms of inflation. We have full hope that the inflation rate will come down to the level of 4 percent. Earlier, RBI Deputy Governor Michael Patra had indicated that the inflation rate will remain at the figure of 4 percent in the financial year 2026. Last week, MPC (Monetary Policy Committee) had announced to keep interest rates stable for the 10th consecutive time. Since then, speculations were being made that interest rates may be reduced in the meeting to be held in December. But, the RBI Governor does not seem to be in such a mood at present.
RBI does not manage exchange rate
On the issue of cutting interest rates by other central banks of the world, he said that we do not want to join this party yet. We are in a wait and watch mode. We will take a decision on this only when the right time comes. We are seeing the impact of the decisions of other central banks on the economy. But, our priority is inflation, economic growth and economy in the country. Apart from this, he clarified that we do not manage the exchange rate. We buy and sell dollars according to our needs.
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