Amid expectations that RBI will hike policy rates later this month to tame high inflation, Finance Minister Pranab Mukherjee has said the central bank will take appropriate monetary action to stabilise prices.
"Whenever the appropriate adjustment of the crucial rates is called for in the larger interest of the economy, including the price stabilistion, the RBI takes appropriate policy in consultation with the government," Mukherjee told reporters.
He was addressing a joint a press conference with World Bank Group President Robert Zoellick here. Mukherjee said the Reserve Bank of India (RBI) always keeps the economic situation under review.
The RBI is widely expected to raise short-term lending and borrowing rates -- repo and reverse repo -- in its policy review on January 25 to tame inflation, particularly food inflation. Expensive food items pushed overall inflation to 8.