Scope

he highlights of the Reserve Bank of India's first quarter review of Annual Policy for 2006-07(April-March) released Tuesday:

Ш Reverse Repo rate hiked by 25 bps to 6.00%

Ш Repo rate hiked by 25 bps to 7.00%

Ш Bank Rate unchanged at 6.00%

Ш Cash reserve ratio unchanged at 5.00%

Ш Inflation target maintained at 5.0-5.5%

Ш Gross Domestic Product target maintained at 7.5-8.0%

INFLATION

Ш Upside risks to inflation evident as oil price pass-through

incomplete.

Ш Outlook for inflation firming up.

Ш Price stability created conducive conditions for growth.

Ш Petrol, diesel price hike in Jun added 45 bps to headline inflation.

Ш Risks to inflation amplified by intl oil price rise

Ш Inflation monitored with supply-side response from govt.

Ш Rise in local, global food prices relevant factor for inflation.

Ш Global risks noted in Apr policy "materializing", "heightening"

GROWTH

Ш Corporate performance remain robust despite some deceleration.

Ш Investment activity picking up; environment is of capital

expenditures by cos.

Ш Companies' order books expanding.

MONETARY AGGREGATES

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