ET caught up with Reserve Bank of India (RBI) Governor, for his take on the latest repo rate cut. Edited excerpts:I am not sure you can say that. We have moved whenever we have felt comfortable about inflation. We did not move in April because we were looking for more information on the rains and possible disruptions. We were looking for more certainty on the monsoon, which we did not get. In fact, after our policy on Tuesday, we did get more information which was negative rather than positive.That could still change, of course. We were looking for information on the normalisation of monetary policy. We were looking for information on the state of the economy. Taking into account all the information we have got since April, we are not more comfortable on inflation than we were in April. It's despite the fact that the weather disruptions did not result in higher food prices in April. However, what we did learn was that the state of the economy is probably weaker than we thought because of poor corporate results that gave us some room to cut interest rates in the policy on Tuesday. But we used all the room we had.People are asking all kinds of questions regarding Tuesday’s repo rate cut. In reply, I will say that we have used up the room we had. We have moved a little from having a balanced inflation to having some upside risk in inflation forecast for the beginning of next year.We have always used the room we have had. We have never had excess room. When people look at today's (Wednesday’s) inflation reading 4.87 per cent, they can't understand why rates haven't been cut more. They do not understand the fact that we are trying to look at future inflation. Now, that is an art, not a science. You are free to dispute RBI's assessments, but we are only trying to use whatever room our assessments have provided us. If you have a better model of inflation forecasting, bring it forward. For people who say that we missed the reduction in oil prices last year which contributed to inflation falling below our forecast, show me one forecast that got it right. Also, find any forecast that said there was any chance of us reaching 6 per cent by January 2016.November was when OPEC took its decision. It was after OPEC decided to maintain production levels that you saw the precipitous fall in oil prices. We cut rates in January, which was as soon as we were sure. Remember, we were also changing the inflation index numbers. We were also coming into a new year when we see the base effects. It would be irresponsible not to wait for a few weeks. Now, if you think a few weeks make a big difference in growth, then I think you are working with different economic parameters.Yes, that is why we went ahead this time.We did not think there was room available. We have never come up with a forecast which says we are going to be substantially below 6 per cent, right?Are you suggesting I should not be data dependent?Do you want me to go on intuition?But Fed's statements have been changing repeatedly.Look at the commentary in the papers today (Wednesday). You will find all kinds of people saying all kinds of things — some saying we are consistent, some others saying some totally confusing things. We are trying to operate in an economy which has inflationary buyers. We have had substantially higher inflation than the rest of the world. Others are moving to a new framework; they are trying to put these inflationary buyers behind them.Given this nature of our economy, we are trying to bring inflation down so that we can have finally lower nominal interest rates. That can result in many years of strong growth. We did this once; it was during Dr. Rangarajan's time when the RBI created the environment for 8-9 years of strong, sustained growth.But after that, we let the inflation genie out of the bag again. We stopped paying attention to the underlying inflationary forces and chose to respond to people who said cut interest rates. Then, in 2008-10, when growth was already substantially stronger than anticipated, we again started having confusion about the growth numbers. The first estimates of growth came in very weak. We thought there was need for a lot of stimulus. We stimulated, and then found we had overstimulated.So, the point is, we have to do the best job we can in a very noisy world. We are trying to use all the room we have keeping in mind that our inflation objective would be silly to miss. It would imply a tremendous loss of credibility.But we are not trying to be overly conservative. We are trying to hit it on the nose. Mind you, there will also be people who would say we have been excessively aggressive this time by cutting interest rates once more.No, I do not think so. The primary lesson from economics is bringing inflation down; make people feel comfortable with low levels of inflation, and then bring normal interest rates down as low as possible. Today, the rest of the world is in deflation. We have very high inflation, and as a result, we cannot bring normal interest rates down. People keep complaining: US interest rates are at quarter percentage points and we are at 7.25 per cent; is that not a terrible thing? I say, yes. But look at the inflation differentials. That will make it clear that we absolutely have to bring down inflation for achieving sustainable growth. Again, let me point out, this is what Dr. Rangarajan did.