The Hindu Business Line : No snags in Govt borrowing programme: RBI

THE Reserve Bank of India does not anticipate any difficulty in the Government-borrowing programme as liquidity position is expected to be comfortable, the RBI Deputy Governor, Dr Rakesh Mohan, told journalists on the sidelines of the 3rd Annual Citibank-Fitch debt markets conference.

Dr Mohan also reiterated RBI's stance on inflation; that a measured response to inflation would be taken owing to its rise in the recent past. Speaking at the conference, he said that the expectations of the people point towards a lower inflation, as a sharp reaction is observed on its rise. This awareness has been helped by the inflation figure hovering around 4 to 5 per cent since 1997; prior to it, the figure was in the range of 7 per cent and above, he said.

Debt market participants perceive that the comments made by the RBI Deputy Governor would not have a notable impact on the debt market. The influence on inflation is primarily on account of high oil prices internationally, over which very little control can be exercised, they said.

Dr Mohan also gave a detailed account of the various measures taken to develop the Government securities (G-sec) market since 1992.

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