The chorus calling for India’s central bank to lower interest rates at its meeting next week gained a new voice, with the finance minister telling CNBC he also wants a cut.
“As somebody who wants India’s economy to grow and who wants domestic demand to grow, I would want the rates to come down,” India’s Minister of Finance Arun Jaitley told CNBC .
But having entrusted the Reserve Bank of India (RBI) with this responsibility, Jaitley said he was sure that the central bank was aware of economic developments and expressed confidence that the RBI will appropriately act with a sense of responsibility.
“I am certain that the RBI (Reserve Bank of India), along with the governor and all his other colleagues, will come to a very balanced decision,” he said. The RBI’s next meeting is on Sept. 29.
Jaitley’s push for a rate cut from the current 7.25 percent level follows the country’s top economic advisor, Arvind Subramanian, saying earlier this month that he is concerned about deflation, not inflation in Asia’s third largest economy. Consumer price inflation in August slowed in August, with prices rising 3.66 percent on-year, while the wholesale price index dropped 4.95 percent on-year in the month.