Hyderabad : Raghuram Rajan, Reserve Bank of India governor, who will be demitting office in less than two months, on Monday said that the rupee level currently is pretty reasonable and any attempt to devalue it may lead to a surge in inflationary pressures and offset any benefits.
Addressing the national seminar on ‘Equity, Access and Inclusion-Transforming Rural India through Financial Inclusion’ here, Rajan said the central bank is trying to make it attractive for institutions to offer banking services to everyone, as it is necessary for sustainable growth.
According to the PTI Report the Governor also ruled out another interest rate cut in the upcoming monetary policy review on August 9, citing the firming-up of inflation.He said that the CPI June numbers last week were 5.8 percent and the policy rate is 6.5 percent. “Somehow inflation is very low for us to be seen as behind the curve. I don’t pay attention to this kind of dialogue,” added Rajan.
He also called for manageable and sustainable credit expansion in the country, saying all avenues for this should be explored. Rajan underlined the need for building new institutions in rural areas to ease access to credit. He was also in favour of exploring the possibility of banks working with money lenders while addressing concerns associated with such an arrangement.
