India central bank holds rates steady amid high inflation, signals tighter liquidity conditions

The Reserve Bank of India kept its key lending rate unchanged at 6.50% for the fourth consecutive meeting.
The bank remains focused on bringing inflation to its 4% target and sees it falling in the next fiscal year.
Food prices, especially vegetables, have pushed inflation above the central bank's comfort band.
To manage liquidity, the RBI signaled it may conduct open market bond sales, sparking a sharp rise in bond yields.
The bank maintained its full year GDP growth forecast at 6.5% for 2023-24.