Mentioning slow economic growth, Rajan hints at cut in Interest rate

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Washington: Hinting at the fourth interest rate cut in 2015, RBI governor Raghuram Rajan said that he is not done with lowering rates and the central problem for the entire world remains slowing economic growth.

He added, “RBI has reached an agreement with the government on a new rate-setting panel, the Monetary Policy Committee, which would be announced soon.”

Rajan, who has under pressure from the government and the industry to further cut rates, said RBI is still in an “accommodative mode” and would take a decision as per the data on inflation and other macroeconomic factors.

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He said, “We also have inflation which other people do not have. We have cut the interest rate thrice so far this year and we are still in accommodative mode. We will have a look at data as it comes in and take a view accordingly. We have not said we are finished (on cutting rates) and we will take a view as the data allows us to do.”