Four of the six members voted in favour of the decision.
In a poll conducted ahead of the federal budget on Feb. 1,
more than three-quarters of economists, 40 of 52, expected the
RBI to raise the repo rate by 25 bps. The remaining 12 predicted
no change.
The annual retail inflation rate eased to 5.72% in December
from 5.88% in the previous month, falling below the RBI's upper
tolerance band of 2%-6% for a second straight month.
(Reporting by Swati Bhat and Sudipto Ganguly; additonal
reporting by Nupur Anand; Editing by Kim Coghill)
MUMBAI, Feb 8 (Reuters) - The Reserve Bank of India's
key repo rate was raised by 25 basis points (bps) on Wednesday
as widely expected, the sixth straight increase, as core
inflation remained high despite signs retail inflation has
peaked.
The central bank said that its policy stance remains focused
on withdrawal of accomodation.
Most analysts expect this hike to be the final increase in
the RBI's current tightening cycle, which has seen it raise
rates by 250 bps since May last year.
The monetary policy committee (MPC), comprising three
members from the central bank and three external members, raised
the key lending rate or the repo rate to 6.50% in a
split decision.
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.