Pay more, if you have taken loan for a car, a house, or any other loan as the interest rates on loans rises by 25 basis, from the existing 7.25 per cent to 7.50 per cent points. This step has been taken to control the spiralling inflation. RBI has sought to maintain an interest rate environment that moderates inflation and checks inflationary expectations. It has kept the other rates and ratios unchanged. The mid-quarterly policy initiatives, the RBI said, are expected to contain inflation, which is currently over 9 per cent, much above the comfort level of the central bank.
The Finance Minister Shri Mukherjee has stated that this was on expected lines, as the core inflation hardened to 8.71 per cent in May 2011 in comparison to 7.93 per cent in April 2011 . Shri Mukherjee stated that there was a need to have better price stability for sustaining growth in the medium-term.
