The new RBI governor, Sanjay Malhotra on Wednesday said the central bank will maintain continuity and stability in policy matters but emphasised the need to remain "alert and agile" in the wake of the current global economic and political environment.
Earlier in the day, he took charge as the 26th governor of the Reserve Bank, replacing Shaktikanta Das who demitted office after six years.
"As we have to be conscious of the fact that we do maintain continuity and stability, we cannot be stuck to it, and we have to be alert and agile to meet challenges," Malhotra said in his first interaction as governor with media.
In his brief statement, Malhotra also stressed that the central bank will continue to interact with all segments, including financial regulators, state governments, and the Centre, to continue the Reserve Bank's legacy.
“Change is the only constant. We have to be conscious of that,” Malhotra said. “The huge responsibility we have in ensuring that the growth this country has, continues,” he said.
While Malhotra’s views on monetary policy are still unknown, he emphasised the need for stability and policy continuity in his new role.
The change of guard at the RBI comes when Asia’s third-largest economy is facing headwinds. Growth in the July-September quarter dipped unexpectedly to a seven-quarter low of 5.4%, putting pressure on the central bank to reduce what other top officials in Narendra Modi’s government have said are overly high borrowing costs. While inflation is expected to ease in November, it remains well above the central bank’s target of 4%.
To combat price gains, the RBI has kept interest rates unchanged for almost two years. Under Malhotra, analysts expect the central bank to take a softer approach to monetary policy and begin easing.
(By arrangement with livemint.com)
