ISTANBUL

The Reserve Bank of India kept its policy interest rate at 6.5% on Wednesday for the 10th time in a row since April 2023.

The bank said annual inflation in the country had declined sharply to 3.6% in July and 3.7% in August from 5.1% in June.

The world economy has remained resilient and is expected to maintain stable momentum over the rest of 2024, while intensifying geopolitical conflicts continue to pose downside risks, it noted.

"In India, real gross domestic product (GDP) registered a growth of 6.7 per cent in Q1:2024-25, driven by private consumption and investment."

The monetary policy committee of the bank stated that the domestic growth outlook remains resilient, supported by domestic drivers including private consumption and investment. This provides headroom for monetary policy to focus on the goal of attaining a durable alignment with target inflation, it added.

The bank gradually increased the rate from 4% in April 2022 to 6.5% in February 2023.