India hikes interest rates amid inflation risks
The Indian Central Bank has raised interest rates for the first time since 2023, by 25 basis points to 5.50%, in response to rising inflation. This decision comes despite sustained strong economic growth of 7.8% in the last quarter, although inflation, adjusted at 4.8% in August, exceeded the target of 4%. It is expected that the bank will increase interest rates again in December to address inflation risks, amid global challenges including supply disruptions and climate risks. India remains the fastest-growing major economy, despite the projected slowdown in growth to 7.1% in the upcoming fiscal year.
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