The Reserve Bank of India (RBI) will strive to get headline inflation to its 4% target, Governor Shaktikanta Das said, while flagging El Nino as a challenge to its efforts.
In an exclusive interview with PTI Bhasha, Das exuded confidence that the economy will grow at 6.5% in FY24, as estimated by the RBI earlier. The central bank's rate hikes by a cumulative 2.50% since May last year, coupled with supply-side measures from the government, have helped get the inflation down to 4.25% in May from a peak of 7.8% in April last year, Das said.
"We continue to be watchful on the inflation front. We expect inflation to be at 5.1% in FY24, and we will continue to strive and get it down to 4%," he added.
On the high borrowing costs, Das said interest rates on loans may have a direct relation with inflation, and if inflation cools down on a durable basis, people can expect lower interest rates on loans.
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