There is a 'contradiction' in the higher GDP growth numbers and poor corporate earnings while there was no visible pick-up in the consumer demand, he added.

"In some sense it is a Goldilocks policy, just right given the current situation," Rajan said, while defending his third 0.25 percent rate cut this year despite lingering concerns over the below-normal monsoons as well as steadily firming oil prices and their impact on inflation.

After two off-policy rate cuts of 0.25 per cent each since January, Rajan today reduced the short-term lending rates by 25 basis points to 7.25   percent.

"The RBI is not a cheer leader. Our job is to give people confidence in the value of the rupee, in the prospects of inflation, and having established that confidence, create a longer-term framework for good decisions to be made.

"Every time an exporter comes to me and says that stability has been very valuable for us to make decisions, that reinforces my view that these our main role is not to act as cheer leaders," Rajan told reporters here at the customary post-policy press briefing.

His response came on a query as to why RBI chose a moderate 25 bps cut and not a "booster-dose of 50 basis points".

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