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सेमिनार: अंग्रेज़ी सीखने का अवसर (23 सितंबर: दोपहर 3 बजे)
RBI Keeps Rates Unchanged
Apr 10, 2015

The Reserve Bank of India (RBI) kept interest rates on hold at 7.50 percent on April 7, waiting to assess inflationary pressures and give banks more time to reflect its previous cuts in their lending rates. The RBI said it would maintain an accommodative stance but cited risks, raising some uncertainty about when it would cut rates next. 

  • The RBI has cut rates twice this year, by a total 50 basis points, to bolster the economy, making both moves outside of the regular policy reviews.

  • The RBI projected CPI would stay at current levels in the April-June quarter, and fall to around 4 percent by August, but rise to 5.8 percent by the end of the year.

  • The RBI will also be wary of the potential for tensions in the Middle East to force oil prices higher.

  • The RBI reiterated its target of 6 percent CPI by January 2016 and set a new target of 4 percent by the end of 2017-18, the midpoint of the CPI range.

  • It projected economic growth of 7.8 percent in the 2015-16 fiscal year, using methodology adopted by the government earlier this year. The government predicts 8.0 to 8.5 percent growth.

  • Developments in sectoral prices, especially those of food, will be monitored, as will the effects of recent weather disturbances and the likely strength of the monsoon, as the Reserve Bank stays vigilant to any threats to the disinflation that is underway.

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