RBI rate cut necessary for sustained growth: DEA

New Delhi: Welcoming the 25 basis points cut in the repo rate by the Resxerve Bank of India, the Department of Economic Affairs (DEA) on Wednesday said the step was necessary to converge toward appropriate real monetary conditions for India's sustained growth.

"We have taken note of the statement of the MPC (Monetary Policy Committee) and its assessment of the inflation and growth outlook," DEA Secretary Subhash Chandra Garg said in a statement here.

"We welcome the 25 basis points cut in the repo rate as an important step to converge toward appropriate real monetary conditions for sustained growth consistent with India's potential and for stable, moderate inflation," Garg added.

The Reserve Bank of India, in its third bi-monthly monetary policy review for 2017-18, announced that the repurchase rate, or the short-term lending rate for commercial banks on loans taken from it, stands lowered to 6 per cent from 6.25 per cent.