RBI opens talks with finmin on monetary policy

NEW DELHI, Aug 10 (Reuters): India's central bank has started preliminary discussions with the finance ministry on monetary policy framework, which includes targeting consumer price index-based inflation, its governor Raghuram Rajan on Sunday said.

Last week, the central bank kept the policy rates unchanged, third time in a row at 8 per cent, and set a target to bring down retail inflation to 6 per cent by March 2016.

Rajan also said cut in the Statutory Liquidity Ratio (SLR) will not impact government's borrowing costs as credit demand remains muted.

On August 5, the Reserve Bank of India lowered banks' minimum bond holding requirements, known as the SLR, by half a percentage point to 22.0 per cent to free up more money for lending, effective from August 9.