With the policy rate as the instrument, there is a trade-off in terms of growth while bringing down the inflation rate to the target. However, a moderate inflation rate is also needed to achieve sustained high growth. While real interest rates above 2% may not be sustainable from a growth perspective, the persistence of inflation above the target is also unacceptable in the present framework, says Shashanka Bhide, member of the Monetary Policy Committee of the Reserve Bank of India.