Today, the Reserve Bank of India decided to raise interest rates by a quarter percentage point in the twelfth move since March 2010 to contain inflationary pressures despite the slowing pace of growth.

The bank raised the repurchase rate to 8.25% from 8.0% and the borrowing rates to 7.25% from 7.0%.

The RBI said it remained imperative to persist with the current anti-inflationary stance especially after we saw inflation in August showing no signs of slowing with wholesale inflation rising 9.8% last month despite slowing growth forcing the RBI to hold onto the hawkish stance.