The Reserve Bank of India unanimously decided to keep the policy rate at 5.25% at its meeting today, while maintaining a neutral monetary policy stance. All six members of the Monetary Policy Committee voted in favor. The central bank also raised its GDP growth forecast for the current fiscal year to 6.7% from 6.6%, and lowered its average inflation forecast to 5% from 5.1%. The core inflation forecast was cut sharply to 4.3% from 4.7%. RBI Governor said headline inflation has risen above target due to higher fuel prices, but overall price pressures remain under control, and the RBI will not rush into any action until there is more clarity on the inflation situation.
RBI holds rates, maintains neutral stance, lowers inflation forecasts, supporting bond yields
