He added, "Further the likely announcement regarding the extension of the 5:25 formula for existing projects points to the fact that there is focus on creating enablers for easing up of business conduct and lubricating the system, thereby stimulate credit flows and industrial activity"
Earlier today, Dr. Raghuram Rajan said that there would be no cuts in the REPO rates or the reverse REPO rates. Driven by softening of fuel and food prices, the wholesale price inflation dropped for the fifth consecutive month to 1.77 per cent in October, its slowest since October 2009. Retail inflation at 5.52 per cent has been the slowest since January 2012. Prime concerns such as food inflation, slowed to 2.7 per cent in October, from 9.6 per cent in May - its lowest level since February 2012. RBI is targeting retail inflation at 8 per cent in January 2015 to 6 per cent in January 2016. Therefore, there was pressure on the governor to cut the interest rate in its bi-monthly monetary policy.