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Reserve Bank of India unexpectedly lowered main rate

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Staff Writer | February 8, 2017
India's central bank unexpectedly lowered its main policy rate despite a slowing economy and price pressures.
Reserve Bank of India
Economy in Asia   Activity in India took a big hit in 2016
The Reserve Bank of India kept its benchmark policy rate at 6.25%, contrary to expectations for a reduction.

Consumer prices on the Subcontinent slowed to a 3.41% year-on-year clip in December, coming in well below the monetary authority's 5.0% target.

Activity in South Asia's largest economy took a big hit in 2016 after the government's controversial decision to eliminate high denomination bills from circulation, bolstering expectations for rate cuts.

Furthermore, New Delhi's new federal budget for the next fiscal year, starting on 1 April, aimed to reduce the country's fiscal deficit from 3.5% to 3.2%.