RBI Rate Cut: RBI Governor gave a blow to the hopes of cutting interest rates, said – not considering any such thing

RBI Rate Cut: There is bad news for those who are hopeful of EMI becoming cheaper.  At present RBI is not going to reduce interest rates. Amid speculations about reduction in interest rates in the current year, banking sector regulator Reserve Bank of India Governor Shaktikanta Das has said that at present RBI is not considering cutting interest rates. He said that the big focus of RBI is to bring the inflation rate to the target of 4 percent. 

Speaking to Bloomberg TV, Shaktikanta Das said that cutting interest rates is not included in our agenda at this time. He said that there is no discussion on this right now. He said that our biggest goal is to bring the inflation rate to the level of 4 percent. RBI Governor said, we are moving towards four percent inflation rate. Unless we reach 4 percent inflation rate, it will be meaningless to talk about cutting interest rates. 

The RBI Governor said that after the start of the war between Russia and Ukraine, the retail inflation rate had reached 7.8 percent in April 2022. Now it has come between RBI's target of 2 to 6 percent. But RBI's target is to bring it down to 4 percent. According to the retail inflation rate announced for the month of December 2023, the retail inflation rate has increased to 5.69 percent in December which was 5.55 percent in November. 

The retail inflation rate has increased due to the sharp rise in the prices of food items including pulses, grains and vegetables. Food inflation rate in the month of December was 9.53 percent which was 8.70 percent in November. There has been an increase in the inflation of pulses in the month of December and it has increased to 20.73 percent which was 20.23 percent in the month of November. There has been a huge increase in the inflation rate of vegetables and it has increased to 27.64 percent which was 17.70 percent last month. 

Earlier, economists at American investment bank Goldman Sachs have predicted a cut in interest rates in India in the second week of January 2024. He believes that the Reserve Bank of India will start cutting interest rates from the third quarter (July to September) of 2024. Whereas earlier Goldman Sachs had predicted a cut in interest rates from the fourth quarter. 

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