India’s central bank has increased interest rates again, as they continue to attempt to control price increases in the country.
Inflation in the country has been causing a lot of problems, and has been a hotly debated political issue as the CPI (consumer price index) was up 8.3% in February from the year before.
The Reserve Bank of the country has now increased the interest rate to 6.75%, an eighth increase in the last year and a stark contrast to Britain (0.5%) and the US (0.25.%)
The bank wants to cut inflation to 7% by the end of March, as the countries prime minister has warned that the increase in prices could be a “serious threat” to the economic growth the country is experiencing.
India have actually made one of the best recoveries from the global recession, but increases in the price of food and essentials are threatening to slow down their growth rate.
“Inflation levels are scary,” said Rupa Rege Nitsure of state-run Bank of Baroda.
“This is the right opportunity for the Reserve Bank to take an aggressive stance,” he added.