India's central bank, the Reserve Bank of India, announced on Tuesday that it would keep key interest rates unchanged at 8 percent despite pressure from the government to lower rates.
According to the announcement, interest rate, or the repo rate, remains unchanged at 8 percent and the reverse repo rate stays at 7 percent. The cash reserve ratio remains the same at 4 percent.
Most think the central bank will wait until February or April to ease rates despite sharply lower inflation.
Limp economic growth during Prime Minister Narendra Modi's first six months in power, however, has caused unease in government quarters, raising some calls for an early reduction.
However, helped by tumbling oil prices, India's annual consumer price inflation slowed to 5.52 percent in October, sharply down from a peak of 11.16 percent struck in November last year.
Indian central bank governor Raghuram Rajan said, "If the current inflation momentum and changes in inflationary expectations continue, and fiscal developments are encouraging, a change in the monetary policy stance is likely early next year, including outside the policy review cycle."
Rajan has said that he will not hold rates for longer than needed. But analysts say that the central bank governor remains wary of factors outside his control, like volatile oil prices, even with the inflation rate running below the central bank target of 6 percent inflation by January 2016.
The Indian economy is struggling to emerge from its slowest phase of growth since the 1980s. Latest data showed year-on-year growth slipped to 5.3 percent in the July-September quarter, down from 5.7 percent in the previous quarter.