FM agrees with RBI monetary stance, not with growth forecast

RBI-LD FM

New Delhi, Oct 27 (PTI) Finance Minister of India Pranab
Mukherjee Tuesday welcomed the status quo in Reserve Bank of
India (RBI)'s monetary policy stance, but disagreed with the
bank's six per cent growth forecast saying it would continue
with fiscal stimulus till the economy showed signs of firm
recovery.

The central bank Tuesday hiked Statutory Liquidity Ratio,
the portion of deposits that banks are to park in government
bonds, by one percentage point to 25 per cent, while
retaining all other key rates.
"RBI always makes very hard and conservative
assessment... (on) GDP growth I am inclined to accept the
figure of Prime Minister's Economic Advisory Council, headed
by C Ranagarajan, that means from 6.5 to 6.75 per cent,"
Mukherjee told reporters here.
"Of course, the assessment of the RBI on the whole... is
in conformity with the government's own thinking on both
fiscal policy as well as monetary policy," he said.
RBI Governor D Subbarao said the hike in SLR was
constituted "the first phase of exit" from its accommodative
monetary policy ushered in last year.
Asked whether stimulus measures will continue, Mukherjee
said, "As I mentioned that until the economy is on a firm
recovery path, it will continue." PTI TEAM
SDE


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