RBI will use all instruments to save rupee: Subbarao

Reserve Bank of India governor D. Subbarao today addressed a press conference after a board meeting.

The meet comes a day after Finance Minister P. Chidambaram met the heads of public sector banks and urged them to cut lending rates.

So far only Bank of India has cut its base rate - the rate below which it cannot lend to customers - by 25 basis points, while State Bank of India, the country's largest lender, has ruled out the possibility.

"We are already at the lowest. We are at 9.7 per cent (base rate). Other banks have been asked (by Finance Minister P. Chidambaram) to come to SBI level," State Bank chairman Pratip Chaudhuri said yesterday.

The RBI has so far cut rates three times in 2013 - from 8 per cent to 7.25 per cent right now.

Here are the highlights of Mr. Subbarao's press conference:

• Neither government nor institutions have complete idea of fraudulent schemes
• RBI teams will study why villagers are attracted towards fraudulent schemes
• Primary responsibility with state governments to check fraudulent schemes
• On rupee volatility: No exchange rate target but we use all instruments at our command
• On bank licences: No definite numbers yet
• No plan to pay interest on cash reserve ratio
• RBI has no guidelines on education loans
• Current account deficit a matter of concern. We should be working towards reducing it.
• No all eligible applicants may get licences for new banks
• Counterfeit currency remains a problem. Encouraging banks to identify and report. Public must surrender counterfeit currency.