RBI holds rates steady, boosts banks' liquidity

Mumbai

INDIA'S central bank held interest rates steady on Tuesday, while boosting banks' liquidity in a bid to persuade them to lower lending rates after they failed to pass on the benefits of the last official rate cut three weeks ago.

The Reserve Bank of India (RBI) kept its policy repo rate unchanged at 7.75 per cent, as expected by analysts, leaving its next reduction probably until after the government presents its annual budget at the end of this month. "Given that there have been no substantial new developments on the disinflationary process or on the fiscal outlook since Jan 15, it is appropriate for the Reserve Bank to await them and maintain the current interest stance," the central bank said.