The Reserve Bank of India, RBI has raised short-term lending rate by 0.25 per cent to 7.75 per cent with the immediate effect. RBI has also decided to cut Marginal Standing Facility (MSF) rate by 0.25 per cent to 8.75 per cent. The apex bank has kept Cash Reserve Ratio unchanged at 4 per cent. It has cut economic growth forecast for this fiscal to 5 per cent from 5.5 per cent projected earlier. The bank says retail inflation will remain above 9 per cent and Wholesale Price Index (WPI) inflation is expected to remain higher.

It called for appropriate policy response to deal with it. The apex Bank expects growth to pick up in second half of current fiscal on good performance of exports and agriculture