(MENAFN) The Reserve Bank of India (RBI) lowered its policy interest rate to a four year low of 6.75 percent on Tuesday, in an unexpected move that could help an economy in risk of reducing with inflation running at record lows.
The RBI had before cut interest rates three times this year, reducing it by 25 basis points each time, and it explained the higher decrease saying consumer inflation was likely to run at 5.8 percent, less the 6 percent target for January.
Simultaneously, the central bank cut its economic growth projection to only 7.4 percent in the fiscal year ending in March 2016, lower than its previous 7.6 percent estimation, according to what the data showed.
"Monetary policy action has to be accommodative to the extent possible, given its inflation goals, while recognizing that continuing policy implementation will be the primary impetus for sustainable growth" said the RBI.
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