Today's Paper

RBI holds rates on inflation risk

The Reserve Bank of India (RBI) on Wednesday kept its policy interest rate unchanged, citing risks to the outlook for inflation.

The RBI’s Monetary Policy Committee also raised its estimate for retail inflation in the fourth quarter to 5.1%, from the 4.3-4.7% projected earlier for the second half of the fiscal year.

The RBI said firms polled in its industrial outlook survey expect input prices to harden in the fourth quarter.

“In a scenario of improving economic activity, rising input costs are likely to be passed on to consumers,” the RBI said as it projected retail inflation in the range of 5.1-5.6% for the first half of 2018-19.

The RBI pared its 2017-18 GVA growth estimate to 6.6%, and forecast that the pace would quicken to 7.2% in the next fiscal year.

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