The Reserve Bank of India kept interest rates unchanged at its meeting on Tuesday, a day after data showed India cementing its position as the world's fastest-growing major economy.
The RBI kept its repo rate steady at 6.75 percent, having already slashed the rate four times this year. None of the economists polled by Reuters had expected a change.
In its statement accompanying the rate decision, the RBI said it will use available room to stimulate the economy, if needed, but warned that a recent rise in consumer prices required vigilance. India's economy grew by 7.4 percent in the three months through September, quickening from a 7 percent expansion three months prior.
"While there are areas of robust growth in manufacturing such as capital goods and passenger cars, weak rural and external demand holds back stronger overall growth," the central bank said.
"The step-up in public capital spending and the easing stance of monetary policy provide the enabling environment for a revival in private investment demand, supported by easing input prices and improving conditions for doing business."