India Central Bank Holds Policy Rate Steady As Inflation Moderates

By Kosaku Narioka

India's central bank maintained its policy rate on Thursday as domestic inflation has moderated.

Reserve Bank of India Gov. Shaktikanta Das said the monetary-policy committee unanimously decided to maintain its policy repo rate at 6.50%.

All 15 economists surveyed by The Wall Street Journal expected the Indian central bank to stand pat on its policy rate.

India's consumer-price index in April increased 4.7% from a year earlier following a 5.7% rise in March. That compared with the central bank's inflation target range of 2% to 6%.

India's gross domestic product in the January-March quarter grew 6.1% from a year earlier as domestic demand picked up and consumer confidence continued to strengthen, government data showed last week.

The central bank unexpectedly kept its policy rate unchanged in April amid turbulence in the global banking sector, saying it needed to assess the impact of its recent rate increases.

The RBI started raising its policy rate from 4.00% in May last year in a bid to control a surge in inflation caused by the Russia-Ukraine war and the recovery from the Covid-19 pandemic.

Write to Kosaku Narioka at kosaku.narioka@wsj.com

(END) Dow Jones Newswires

June 08, 2023 00:58 ET (04:58 GMT)

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