Real interest rates need to be lower: RBI guv

RESERVE BANK OF India (RBI) Governor Sanjay Malhotra believes real interest ratesboth headline and core-need to be lower, given the benign inflation outlook, minutes of the Monetary Policy Committee (MPC) meeting released on Friday showed.

- KSHIPRA PETKAR

Malhotra voted for a 25-basis point rate cut as demand pressures are minimal and projected to remain lowin the next three quarters. "This will also stimulate demand and be growth-supportive," he said.

The six-member MPC cut the repo rate by 25 bps to 5.25% in December, taking the total reduction this year to 125 bps. The panel also retained a neutral stance, with five members, including the RBI governor, backing it.