RBI surprises market, keeps interest rates unchanged
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In a surprise move, the Reserve Bank on Wednesday kept the repo rate- the rate at which the central bank lends money to commercial banks- unchanged at 7.75 percent in its mid-quarter review of monetary policy.
Similarly the reverse repo rate too stays at 6.75 percent, the cash reserve ratio (CRR) at 4 percent and the marginal standing facility (MSF) at 8.75 percent.
Wholesale Price Index inflation in November climbed to a 14-month high of 7.52 percent as prices of food items such as onions and potatoes surged. Consumer price inflation touched a nine-month high of 11.24 percent last month.
Factory output shrank 1.8 percent in October, the first contraction in the Index of Industrial Production (IIP) in four months.
RBI Governor Rajan, who delivered two repo rate hikes of 0.25 percent each in as many policy reviews since he took over on September 4, had earlier mentioned that he considered fighting inflation as the central bank's "key responsibility." (ZeeNews)
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