MUMBAI - India unexpectedly raised the reverse repurchase rate while keeping the benchmark unchanged, effectively tightening policy to step up the fight against accelerating inflation. The reverse repo rate was raised to 6% from 5.75% while the benchmark repurchase rate was kept steady at 6.25%, the Reserve Bank of India said in a statement in Mumbai on Thursday. "Underlying inflation pressures persist, especially in prices of services," the RBI said in the statement, reiterating its neutral stance. "The future course of monetary policy will largely depend on incoming data on how macroeconomic conditions are evolving." Surplus funds in the banking system also risk intensifying price pressures and imperilling the RBI’s 4% target.

Source: Bangkok Post April 06, 2017 09:22 UTC