Bad loans are not threatening the entire banking system and the policy guidance given so far would hold until further notice, a deputy governor of the Reserve Bank of India, Subir Gokarn, said at a televised event on Tuesday.

The RBI raised interest rates in late October for the 13th and possibly final time in a tightening cycle that began in early 2010, on expectations that persistently high inflation will finally begin to ease starting in December.

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