Mumbai: In a gesture rarely found among newsmakers, RBI governor Raghuram Rajan on Wednesday said ‘sorry’ for a ‘misleading’ comment that he never made with regard to the central bank’s stance on rates.
Addressing some college students here on Monday, Rajan was reported to have said that India is witnessing an “avalanche” of capital flows as central banks around the world are reducing interest rates to very low levels but the RBI is unable to cut interest rates very quickly to the bone due to “high” inflation in India.
He was speaking at an off-media event, but his comments found their way to the news reports and were construed by some analysts as an indication that RBI was not going to cut rates.
After RBI surprised with a cut in the interest rate this morning, Rajan was asked by analyst about “sudden change in his stance as one day ago he was quoted by the media as saying that RBI is unable to cut interest rates very quickly due to high inflation.
To this he replied with a “sorry”, while adding that he was quoted “out of context” and he did not “mislead” the markets while speaking to students at an event about inflation and interest rates in general.
