RBI should think out of the box: Basu

New Delhi: India's central bank, which reviews monetary policy on Friday, should think outside the box, the chief economic adviser to the finance ministry said on Tuesday.

We live in a very unusual world where some countries have very, very low interest rates whereas other countries have high interest rates so we must think outside the box in terms of monetary policy and that is what I would stress to the Reserve Bank of India, Kaushik Basu said.

Despite industrial output growth slumping to a near two-year low in July, inflation data for August to be released on Wednesday is expected to sway the central bank to raise rates this week for a 12th time since March 2010.

The wholesale price index in August probably was rose 9.6 per cent, a Reuters poll showed, well above the central bank's comfort zone of 4 to 4.5 per cent.

Source: Financial Express