MUMBAI (Reuters) - The Reserve Bank of India (RBI)'s monetary policy committee cited upside risks to inflation arising from price pressure excluding food and fuel as the main reason for keeping its policy rate unchanged, according to minutes of the April meeting released on Thursday.
The 6-member monetary policy committee (MPC) which had unanimously decided to keep the repo rate unchanged at 6.25 percent in early April, had raised a secondary rate called the reverse repo rate, which is used to drain excess funds from banks.
The MPC, which aims to bring down inflation to 4 percent in the medium term, maintained its hawkish stance on inflation, with most members expressing concern over upside risks to core inflation.
One member, M. D. Patra, the executive director of the RBI, and in charge of monetary policy, favoured an increase in the repo rate by 25 basis points as a pre-emptive move to curb inflation pressures.
But Patra finally agreed with the rest of the panel on holding the rate unchanged for now.
(Reporting by Suvashree Dey Choudhury, Devidutta Tripathy and Euan Rocha; editing by Robert Birsel)