RBI to bring down inflation to 7%

The Reserve Bank of India said it would attempt to bring down inflation from 11-12 per cent to 7 per cent by March, 2009.

The Reserve Bank of India on Tuesday announced stringent measures of hiking mandatory cash reserve of the banks and its short-term lending rate to them to suck up an estimated Rs 20,000 crore (Rs 200 billion).

The RBI hiked cash reserve ratio by 25 basis points to 8.75 per cent and the short-term lending (repo) rate by 50 bps to 9.00

per cent.

RBI hikes interest rates