RBI keeps interest rates on hold
RBI said the repo rate would remain at a steep 8.0 per cent
Mumbai: India's central bank kept interest rates unchanged on Tuesday, saying a reduction would be "premature".
The Reserve Bank of India (RBI) said the benchmark repo rate -- the rate at which it lends to commercial banks -- would remain at a steep 8.0 per cent, in line with analysts' expectations.
But it indicated that rates could fall early next year as inflation begins to slide.
Business leaders and finance minister Arun Jaitley, a member of Prime Minister Narendra Modi's right-wing government, have been clamouring for a cut in borrowing costs, which they say deter investment and consumer spending.
"A change in the monetary policy stance at the current juncture is premature," the bank said in a statement.
"However, if the current inflation momentum and changes in inflationary expectations continue, and fiscal developments are encouraging, a change in the monetary policy stance is likely early next year."