India's central bank keeps key lending rates unchanged

Mumbai, June 18 (IANS) The Reserve Bank of India (RBI) Monday kept key lending rates unchanged. The re-purchase rate remains unchanged at eight percent, which automatically keeps the reverse re-purchase rate at seven percent.

The apex bank said that since the last rate cut, global macroeconomic indicators have deteriorated and that the headline inflation numbers are far above the comfort range.

"Since the RBI's annual policy statement in April, global macroeconomic and financial conditions have deteriorated. At the same time, the domestic macroeconomic situation too raises several deepening concerns," the apex bank said in a statement.

"While growth in 2011-12 has moderated significantly, headline inflation remains above levels consistent with sustainable growth. Importantly, retail inflation is also on an uptrend."

In April, Governor Duvvuri Subbarao had cut re-purchase rate by 50 basis points to 8 percent, which automatically impacted the reverse re-purchase rate which dropped to 7 percent from 7.5 percent.