The Reserve Bank of India cut its repo lending rate by 25 basis points on Tuesday to 7.5 per cent a year, meeting analyst expectations.

The cut follows a 25 basis point reduction in the rate in January, the first since April 2012. Though analysts have been forecasting further cuts in the coming months, the RBI has said there is limited room for further action. Continue reading »

Palaniappan Chidambaram, the Indian finance minister, will continue what he sees as his lonely battle to promote much-needed economic growth after the Reserve Bank of India left interest rates unchanged in its latest decision on Tuesday.

The central bank said in its mid-quarter policy review that it was leaving the policy repo rate unchanged at 8.0 per cent. Nor was there any change to the 4.25 per cent cash reserve ratio for banks. Continue reading »

Since April, when the Reserve Bank of India made a surprise 50 basis points cut interest rates, before every monthly policy review meeting the markets speculate that another cut is coming – despite the fact that inflation remains sticky and high.

But the RBI seems immune to hints and suggestions. Continue reading »

The Reserve Bank of India kept benchmark interest rates on hold on Tuesday, in a widely expected bid to contain persistently high inflation, while leaving the growth revival agenda in the hands of the government.

India’s central bank kept the repo rate – the rate at which it lends to commercial banks – at 8 per cent even as markets hoped for a much-needed cut to stimulate borrowing and get growth back on track after a recent nosedive to its lowest level in nine years. Continue reading »