Inflation RBI's primary concern:Subir Gokarn
08 Dec 2012
RBI Deputy Governor Subir Gokarn today said inflation continues to the primary concern for the central bank and RBI should not do anything that provide some short-term stimulus to growth that would raise the risk of longer term inflation.
Speaking at a Bombay Management Association event, Gokarn said, a single action from the bank was unlikely to make a difference and inflation continued to be the primary concern of the monetary policy, due on 18 December.
Demands are once again being reiterated for a rate cut by to boost the economy after quarterly growth in the July-September period fell to 5.3 per cent.
However, analysts feel RBI will continue to hold the rates as inflation continued to be high, at 7.45 per cent in October.
On 30 October the bank cut the cash reserve ratio by 25 basis points or 2.5 per cent, to 4.25 per cent, leaving repo rate (at which banks borrow from RBI) remains unchanged at 8 per cent.
On Thursday RBI governor D Subbarao had stated that growth had moderated steeply, which is being interpreted as an indication of some monetary easing by the central banker.
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