The Reserve Bank today raised the benchmark lending rate by 35 basis points (bps) - the fifth increase since May - saying it remains focussed on bringing down the inflation to a tolerable limit. The move to raise the rate will make loans including housing, auto and corporate credit expensive.
Terming the Indian economy a bright spot in the otherwise gloomy world, the Reserve Bank of India (RBI) lowered its estimate of GDP growth to 6.8 percent in the fiscal ending March 31, 2023, from an earlier forecast of over 7 percent.
However, it kept the inflation forecast unchanged at 6.7 percent for the current fiscal year and projected it to come down below the upper tolerance limit of 6 percent in the fourth quarter of the current financial year.
The Consumer Price Index (CPI) based inflation, which RBI factors in while fixing its benchmark rate, stood at 6.7 percent in October.