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Millennium Post

‘RBI will factor in falling inflation in monetary policy’

The Reserve Bank of India has said that it would take into account falling inflation while deciding on policy initiative in its review next month.

‘We will certainly take note of the softening of inflation and the external payments situation in the next mid-quarter policy statement on 17 June,’ Subbarao said at an event in Frankfurt on Tuesday.

He said, he was happy to see inflation coming down to below 5 per cent mark.

In order to accelerate economic growth, RBI earlier this month cut key interest rates by 0.25 per cent.

 Amid a shrill chorus for a rate cut, the Reserve Bank lowered the short-term lending (repo) rate to 7.25 per cent from 7.50 per cent, lowest since May 2011 while retaining Cash Reserve Ratio for banks unchanged at 4 per cent.
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