RBI keeps repo rate unchanged at 6.50%, seeks to prod banks to lend more

The Reserve Bank of India (RBI) on Wednesday kept policy rates and stance unchanged but cut its inflation expectations sharply, for now, owing to the recent correction in crude oil prices.

RBI Governor Urjit Patel indicated that the policy course could change soon, depending upon the movement in oil prices.

“We need a few more data points to ascertain the durability of the decline in inflation that has taken place in a very short period of time — especially with respect to oil where the implied volatility is higher now than in October, although the price of oil has come down,”