The Finance Ministry on Tuesday endorsed the RBI move to cut repo rate by 25 basis points, stating that the move would boost liquidity in the system.
This would also help the economy move closer to 8 per cent growth this fiscal.
“The RBI policy will boost liquidity in the system... On the whole, this is a decision which will go down well with all sections of the economy,” Ashok Lavasa, Finance Secretary told newspersons here. Lavasa said that both the RBI and the government are in sync on the inflation target. He also said that the RBI deserved to be complimented for the way it has been handling the $20 billion FCNR(B) bond redemption.
“The RBI has managed that position well and we have to be satisfied about that,” Lavasa said.
On GDP growth, Lavasa said: “We have also been saying the economy will inch close to 8 per cent growth. What exactly that number would be it is difficult to say, but certainly we are looking at better times.”
Srivats.kr@thehindu.co.in