No Change in Repo Rate by RBI

Reserve Bank of Indian disappointed Indian markets by keeping policy repo rate unchanged at 8% in its mid quarter monetary policy today on Monday. The Cash Reserve ratio also remained unchanged at 4.75%. Reserve Bank of India (RBI) has said in its monetray policy review that while growth has moderated, inflation is likely to remain above comfort levels The evolving growth-inflation dynamic will continue to influence the Reserve Bank's stance on interest rates. Both headline and retail inflation rates are rising, which have a bearing on inflation expectations. Future actions will depend on a continuing assessment of external and domestic developments that contribute to lowering inflation risks. The increase keeps inflation near its highest level this year - March data was revised up to a 2012 high of 7.69 percent - as policymakers come under pressure to revitalise an economy running at its lowest ebb in nine years.