Indian rate hike part of anti-inflation thrust

Wednesday, 10 November 2010 22:23 - - {{hitsCtrl.values.hits}}

NEW DELHI: The Reserve Bank of India’s decision to raise policy rates in its early November review is expected to sustain the anti- inflation thrust without disrupting growth, minister of state for finance Namo Narain Meena told Parliament in a written reply on Wednesday.

Last week, the Reserve Bank of India (RBI) raised its key lending and borrowing rates by 25 basis points each to 6.25 per cent and 5.25 per cent respectively, bolstering its fight against stubborn inflation, which stood at 8.62 per cent in September.

“These actions (by the RBI) are expected to sustain the anti-inflationary thrust in the face of persistent inflation risks aggravated by the structural nature of food price increases, while at the same time being moderate enough not to disrupt growth,” the statement said.