Apropos the editorial "Sustainable relief?" (September 17), while there may be calls for the Reserve Bank of India (RBI) to lower policy rates, there are many reasons not to. First, lowering interest rates may have an adverse impact on debt inflows, given the US Federal Reserve policy on rolling back its buyback programme. Second, the deficiency in the monsoon has lessened in the past few days, but it remains to be seen whether the level of water in catchment areas has been sufficiently replenished for sustained agricultural production next season. Also, food inflation needs to fall further and remain low for a sustained period to enable RBI to tweak its monetary policy.
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V Sridhar Kolkata
Letters can be mailed, faxed or e-mailed to:
The Editor, Business Standard
Nehru House, 4 Bahadur Shah Zafar Marg
New Delhi 110 002
Fax: (011) 23720201
E-mail: letters@bsmail.in
All letters must have a postal address and telephone number