[dropcap color=”#008040″ boxed=”yes” boxed_radius=”8px” class=”” id=””]T[/dropcap]he Indian central bank on Tuesday kept its short-term lending and borrowing rates unchanged, in line with expectations, balancing its policy action between a comforting, 7.4 percent economic growth for the second quarter of this fiscal and a creeping inflation.
In its fifth bi-monthly monetary policy review of the current fiscal conducted by Reserve Bank of India Governor Raghuram Rajan here, the repurchase rate at which short-term credit is extended to commercial banks was left unchanged at 6.75 percent.
Accordingly, the reverse repurchase rate, or the interest paid by the central bank for short-term borrowings, also stood frozen at 5.75. percent. The statutory liquidity ratio and cash reserve ratio that banks have to keep in liquid assets and government securities also remained intact.
[dropcap color=”#008040″ boxed=”yes” boxed_radius=”8px” class=”” id=””]T[/dropcap]he central bank also kept its overall growth projection for 2015-16 at 7.4 percent and said the inflation target of 6 percent in January next year as set out in the previous policy update also was within reach, albeit with a slight downside risk.
Notes:
1. IANS
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