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India Keeps Rates On Hold

India's central bank decided to keep its key interest rate unchanged and to continue accommodative stance as long as necessary to revive growth, while ensuring that inflation remains within the target.

At the sixth bi-monthly monetary policy meeting, the monetary policy committee of the Reserve Bank of India decided to hold the policy repo rate at 5.15 percent. The bank has also kept the reverse repo rate unchanged at 4.90 percent.

The central bank has lowered its key rate five times by a cumulative 135 basis points in 2019.

The MPC recognizes that there is policy space available for future action, the bank said.

Policymakers observed that the outlook for inflation is highly uncertain at this juncture. At the same time, economic activity remains subdued.

GDP growth for 2020-21 was projected at 6.0 percent. Inflation projection was revised upwards to 6.5 percent for the fourth quarter of FY 2019-20.

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