MUMBAI (Reuters) - The Reserve Bank of India (RBI) will not target the value of the rupee, Governor Raghuram Rajan said on Wednesday, adding it would only intervene at times of volatility as per its stated policy.
The comments come after the RBI on Wednesday said "an excessively strong rupee is undesirable" as part of a statement in which it cut interest rates by 25 basis points to 7.50 percent.
"I said an excessively strong rupee is undesirable, which you'll agree I'm sure with. That's a statement that is very hard for anybody to disagree with. The fact that it is undesirable doesn't mean that we'll necessarily act against it if that situation were to arise," Rajan told analysts at a conference call.
"I believe that what we can do is perhaps act against temporary undesirable volatility. It's very hard for us to act on a sustained basis to maintain a value of the rupee."
Turning to the monetary policy, Rajan said real interest rates of 1.5 to 2.0 percent were appropriate at this point in the economic cycle.
(Reporting by Suvashree Dey Choudhury and Himank Sharma; Editing by Subhranshu Sahu)
