The Reserve Bank of India (RBI) raised interest rates more aggressively than expected on Thursday, keeping up its fight against inflation that is slowly easing but still well above its comfort level.

The RBI lifted the repo rate , at which it lends to banks, by 25 basis points to 6 percent and raised the reverse repo rate, used to absorb excess cash, by 50 basis points to 5 percent.

Analysts in a Reuters poll had forecast increases of 25 basis points in both rates.

Asia's third-biggest economy grew by 8.8 percent in the June quarter from a year earlier, its fastest pace in nearly three years while industrial output rose 13.8 percent annually in July, the fastest since April.

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