Key task is to keep inflation low, says Rajan

Pressure on the RBI increased this week for a rate cut, after inflation dived to a new low in August

The head of the Reserve Bank of India, under pressure from the government and corporates to cut rates, said on Friday that his greatest task would be to keep inflation low not just now, but also in the future.

Pressure on the RBI increased this week, after inflation dived to a new low in August, thanks to falling commodity prices. Adding to that, the United States kept rates steady on Thursday.

RBI governor Raghuram Rajan, however, said any move in India would have to consider long-term inflation implications.

"(The) key task is to keep inflation low, not just today but well into the future," he told a gathering of industrialists and bankers in Mumbai.