Subbarao overruled contrary advice on rate cut

Governor D Subbarao went ahead to reverse the Reserve Bank of India's policy stance in the April review, despite a majority of the external members on its monetary policy committee suggesting only a pause.

After raising policy rates 13 times between March 2010 and October 2012, the central bank maintained status quo in the next three policy meetings.

Then, in April, it had reduced the key repo rate (at which it lends money to banks) for the first time in these three years, by 50

basis points to eight per cent, to boost sluggish growth.

RBI has released the minutes of the April 11 meeting of its Technical Advisory Committee on monetary policy.

The meeting, chaired by Subbarao, was attended by the four deputy governors.

The six external members (five attended) are -- Shankar Acharya, Rakesh Mohan, Indira Rajaraman, Sudipto Mundle, Errol D'Souza and Ashima Goyal.