Wednesday, August 02, 2017,18:16
India's central bank cuts key lending rate to 6 percent
By Associated Press
Wednesday, August 02, 2017, 18:16 By Associated Press

The Reserve Bank of India (RBI) logo is displayed on the bank's building in Mumbai on April 20, 2010. (SAJJAD HUSSAIN / AFP)

NEW DELHI - India's central bank has cuts its key interest rate by a quarter of a percentage point, raising hopes of lower borrowing costs for households as inflation ebbs.

The announcement by the Reserve Bank of India on Wednesday reduced its repo rate to 6 percent. This is the rate at which the central bank lends to commercial banks.

India's inflation rate declined to a record low of 1.54 percent in June, while the annual rate of growth in factory output fell to 1.7 percent in May from 8 percent a year earlier.

Most industrial groups had been pushing for an interest rate cut to help boost the economy by lowering the cost of borrowing.