Government will continue to argue for lowering of interest rates by the Reserve Bank in the backdrop of the softening of headline inflation and the need to promote economic growth, Finance Minister P. Chidambaram said today
“The RBI has to weigh the fact that headline inflation has come down yet consumer price inflation is sticky...it has to keep the current account deficit in mind before it lowers the interest rate.
“But the Government is pro growth and the Government will always argue for lower interest rates,” he said in an interview to CNBC TV18 here.
RBI is scheduled to announce the monetary policy for the current financial year on May 3 during which it will take a call on interest rates keeping in view inflation and other macro-economic parameters such as the growth rate and industrial production.
Chidambaram, who is here to woo investors, said although inflation based on movement in wholesale prices has come down, retail inflation in double digits has continued to be a cause of concern.
“Core inflation has indeed come down. Headline inflation has also come down but the consumer price inflation is still sticky in double digits and that’s what affects the people,” the Minister said.