India holds interest rates steady

New Delhi : India's central bank left interest rates unchanged at 6.25 percent Wednesday, its first monetary policy decision since the government’s shock move to withdraw high-denomination banknotes from circulation.

The Reserve Bank of India said the benchmark repo rate -- the level at which it lends to commercial banks --would stay steady after it was cut to 6.25 percent in October.

Lower interest rates boost consumer spending which can cause an uptick in inflation.

Pressure to cut rates mounted last week, with analysts expecting a 25 basis points cut after India reported a lower-than-expected 7.3 percent growth of gross domestic product in the three months to the end of September.

While that is better than most major economies, it is still lower than earlier predictions.