Reserve Bank Governor Raghuram Rajan cut interest rate by 0.50 percent which is double of what broadly expected. On Tuesday, i.e; 29th September 2015 in a press conference called to announce the fourth bi-monthly monetary policy. Rajan is the man responsible for taking the right policy decisions so that the Indian economy remains on the right course.

In the conference, someone asked him that the decision of cutting interest rates should be seen ‘hawkish’, Rajan said that, “I don’t know what you want to call me… Santa Claus…you want to call me the hawk, I don’t know. I don’t go by this. My name is Raghuram Rajan and I do what I do.”

The latest Policy statements main point is consumer inflation is under control and well on target for achieving its long-term goals.He also said that “Since our last review, the bulk of our conditions for further accommodation have been met. The January 2016 target of 6 percent inflation is likely to be achieved. In the monetary policy statement of April 2015, the Reserve Bank said that it would strive to reach the mid-point of the inflation band by the end of fiscal 2017-18. Therefore, the focus should now shift to bringing inflation to around 5 percent by the end of fiscal 2016-17. While the Reserve Bank’s stance will continue to be accommodative, the focus of monetary action for the near term will shift to working with the government to ensure that impediments to banks passing on the bulk of the cumulative 125 basis points cut in the policy rate are removed.”

This repo rate i.e; 0.50 percent is the biggest in more than three years. The cut brought down repo rate to 6.75 percent, the lowest in four-and-half-years.