Rajan meets Chidambaram ahead of monetary policy review

Ahead of the next monetary policy review next week, Reserve Bank Governor Raghuram Rajan today met Finance Minister P Chidambaram.

Rajan, who was Chief Economic Advisor in the Finance Ministry before taking over as RBI Governor on September 4, is scheduled to announce the next monetary policy review on April 1.

India Inc is hopeful this time that the RBI will cut interest rates to boost growth, taking into account declining inflation.

The central bank had increased a key interest rate to 8% from 7.75% at its previous monetary policy review on January 28.

The annual rate of inflation, based on the monthly wholesale price index, stood at 4.68% in February, slipping below 5% for the first time in nine months as onion and potato prices eased.

Retail inflation was at a 25-month low of 8.1% in February.

The country's economic growth slipped to a decade-low of 4.5% in 2012-13 and is estimated at 4.9% in the current financial year.