Magazine article Business Asia

India Coy on Interest Rates

Magazine article Business Asia

India Coy on Interest Rates

Article excerpt

India's central bank chief has repeated his upbeat view of the economy but is keeping markets in suspense over where interest rates are headed.

Reserve Bank of India (RBI) Governor Bimal Jalan said India's growth was unprecedented and its external economy among the best in the world.

"Our growth rate is 6-6.5 per cent, our inflation is at all-time lows of 3 per cent, our foreign exchange reserves are at their highest and by any standards the world now regards that India's external economy has been managed in a way of which there are very few examples perhaps in the world," Jalan told a financial markets seminar.

India's foreign exchange reserves hit record highs of US$35.17 billion in January and though the rupee, at 43.60 per US dollar, is a short step away from the August 1998 low of 43.70, the central bank appears comfortable with the exchange rate.

Wholesale price inflation is just below 3 per cent and stock markets have been on a record-setting spree. …

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