Neutral stance on rates for now: Rajan

The Reserve Bank of India RBI has a neutral stance on interest rates for now,but it is still worried about high inflation,even when taking out volatile food prices,its new head said on Thursday.

Asked about the RBIs policy stance,the central banks Governor Raghuram Rajan said: At this point we are neutral,we will see how things develop. He said that inflation was not due just to higher food prices.

Unfortunately there is still some inflation when you strip out the effects of food and energy. Therefore it is not just food,its other factors also which are driving inflation, Rajan told reporters on the sidelines of a conference.

CPI core inflation is about 8.2 percent,that is certainly high,but I think we are looking at all aspects of inflation at this point.