New Delhi, Feb. 21 -- Reserve Bank Governor Sanjay Malhotra opined that rate reduction was an appropriate monetary policy response at this juncture citing movement of inflation towards the central bank's 4 per cent target, said the MPC meeting minutes released on Friday.

Malhotra, along with five other members of the Monetary Policy Committee (MPC) had voted for a 25 basis points reduction in the short-term lending rate (repo) to 6.25 per cent. The RBI at its meeting held from February 5 to 7 effected the rate cut after a gap of five years.

"Given the macroeconomic outlook when inflation is expected to align with the target, and recognising that monetary policy is forward-looking, I view a lower policy rate to be more appropriate at the...