Finance Minister Arun Jaitley has welcomed Reserve Bank's cutting the key interest rate by 0.5 per cent, nudging banks to transmit the benefit to borrowers so as to boost investments and the economy.<br/><br/>The rate cut, he said, will reduce the cost of funds and help economic recovery.<br/><br/>RBI in its fourth bi-monthly monetary policy for the current fiscal reduced the lending rate by 0.5 per cent with a view to boosting growth. It has cut the benchmark lending rate by a total of 1.25 per cent since January.<br/><br/>As regards the price situation, Mr Jaitley said there will be a need to have a constant vigilance now on the inflation front. <br/><br/>This decision of the RBI actually implies that inflation pressure has moderated significantly and is now within the comfort zone, he said. The government, he stressed, is fully committed to meeting the fiscal deficit target in order to consolidate the gains achieved by the contained inflation.