The Reserve Bank of India increased its policy rate by 50 basis points to 4.90 percent.
After the Reserve Bank of Australia, the Central Bank of India, another major central bank in the Asia-Pacific region, also increased interest rates. The bank raised its policy rate by 50 basis points to 4.90 percent. Thus, interest rates increased for the second consecutive month in India. Economists had expected a 40 basis point rate hike.
Shaktikanta Das, Governor of the Reserve Bank of India, emphasized inflation in the online meeting after the decision. Das stated that inflation has gone beyond the upper band of the tolerance level. Chairman Das said that food, energy, and commodity prices remained high. The bank’s inflation target is in the 2-6 percent band.
