Hope RBI will be more benevolent with monetary policy: Arvind Mayaram

NEW DELHI: Exuding confidence that inflation would moderate by March, Department of Economic Affairs Secretary Arvind Mayaram has suggested that RBI be more "benevolent" in its monetary policy stance in wake of recent steps to help the economic growth.

"We estimate that inflation will begin to moderate sometime in January and by March we will see full impact of moderation in inflation with the steps are being taken," he told Bloomberg Television in Tokyo.

The secretary said the RBI would be comfortable if the inflation comes down to 5-5.5 per cent.

"...it (inflation) should reach there (5-5.5 per cent) by March...If the RBI is fully convinced that the steps that are being taken are credible and will result in something like that, then we hope that the RBI will be more benevolent with its policy," he said.

The Reserve Bank of India (RBI) is scheduled to unveil its second quarter monetary policy review on October 30.

Mayaram, who was in Tokyo to participate in the IMF-World Bank annual meet, was also of the view that RBI will not "wait necessarily" till March for inflation to come down to its comfort zone to ease key policy rate or repo rate.

Amid high interest rate regime impacting economic activities, Mayaram said the RBI is "fully cognizant" of the need now to step up growth.

As per the latest data released today, inflation in September shot up to 7.81 per cent from 7.55 per cent in the previous month.

In order to prop up investment sentiments, the government announced a slew measures including raising price of diesel, liberalising FDI norms for multi-brand retail and aviation.