India hikes interest rates

India’s central bank unexpectedly hiked key interest rates by a quarter of a percentage point, as it tries to cool high inflation amid a faster-than-expected economic rebound.

The bank raised the benchmark repo rate – at which the central bank makes short-term loans to commercial banks – to 5% and raised the reverse repurchase rate – the rate at which it borrows from commercial banks – to 3. %, with immediate effect.