RBI should definitely cut interest rates, says Piyush Goyal

RBI should definitely cut interest rates, says Piyush Goyal

Union Commerce Minister Piyush Goyal on November 14 said Reserve Bank of India (RBI) should definitely cut interest rates.

"RBI must cut interest rates. It’s a flawed theory to consider food inflation for making a choice on cutting rates. This is my personal view and not that of the Govt," said Goyal at CNBC-TV18 Global Leadership Summit.

He also said that inflation will come down by December.

"Inflation under Modi Government has been lowest since India's Independence," said Goyal.

About the recent spate of FII selling, Goyal said, "Investors should take a long term view and not at the quarterly picture."

India's retail inflation surged to a 14-month high in October, driven by a jump in vegetable prices

The annual retail inflation of 6.21% in October breached the central bank's tolerance band for the first time in more than a year.

The Reserve Bank of India (RBI) is mandated to keep inflation in a range of 2%-6%, with a medium term target of 4%.

In September, inflation stood at 5.49%, which was a nine-month high.

Annual inflation for food items, which account for nearly half of the consumption basket, rose to 10.87% from 9.24% a month ago.

At a recent event in October, RBI Governor had said that an interest rate cut at this stage will be 'premature, and very, very risky', and the central bank sees 'significant risks' to the outlook.

Last time around, the monetary policy committee left the repo rate unchanged at 6.5%, but chose to change its stance to neutral.