The government mulls RBI to reduce rates with finance minister; Mr. P Chidambaram said that the government has done with its bit on fiscal consolidation.
FinMin, Mr. P Chidambaram after the customary post-budget board meeting of the central bank said, "On the fiscal consolidation path, the government has walked the talk. RBI, of course, will take into account the overall broad economic situation and what happens between now and March 19 and take a call (on interest rate)... we have delivered on the fiscal consolidation path".
RBI is expected to lower the key policy rates amidst moderating inflation. In January, key rates were reduced by 25 basis points, which were considered as a minor rate cut by the banks.
The government has been continuously mulling RBI to lower interest rates on home loans and auto loans to get consumers back into the market. But RBI has however cited its inability to cut rates as there is high fiscal deficit and inflation.