India’s central bank holds rates, vows to cut inflation

NEW DELHI: India’s central bank kept interest rates unchanged for a sixth time in a row Thursday, as both inflation and economic growth remain high in the world’s fifth-largest economy.

The Reserve Bank of India said its benchmark “repo rate”, the level at which the central bank lends to commercial banks, would stay unchanged at 6.50 percent.

Interest rates were hiked by 2.5 percentage points between May 2022 and February 2023, but have stayed constant since then. India’s economy — which is projected to grow at a brisk 7.3 percent in the financial year ending March 31 — has performed “remarkably well”, central bank governor Shaktikanta Das said.

Last week, India announced a smaller-than-expected fiscal deficit for this financial year, while shunning populist spending in the last budget before national elections expected to begin in April.