India's central bank has kept its key lending rate unchanged at eight per cent in a bid to keep inflation from rising any higher, even as the subcontinent faces a sharp slowdown.
The Reserve Bank of India cut the minimum cash requirement of its banks by 25 basis points to 4.5 per cent of their deposits – a move the institution claims will pump 170 billion rupees (£1.9 billion) into the market.
Decision-makers for the nation – which is the third-largest economy in Asia after Japan and China – announced a 14 per cent increase in diesel prices last week, which is expected to lead to a further rise in consumer prices.
Data released at the end of last week found that the inflation rate in India rose to a higher-than-expected 7.55 per cent in August from a year earlier. Most economists had anticipated the rate to be approximately 6.9 per cent.
At 09:30 BST today (September 17th), the Mumbai Stock Exchange Sensitive Index rose 0.5 per cent to a value of 18572.3 points.
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