The government on Thursday said the Reserve Bank of India's move to hike policy rates was on expected lines and would help in checking inflation, which has crossed 9 per cent mark.
"This (rate hike) was on the expected lines as the core inflation hardened (in May) . . . RBI has sought to maintain an interest rate environment that moderates inflation and check inflationary expectations," the Finance Ministry said.
Headline inflation, as measured by the wholesale price index, was 9.7 per cent in March, 8.7 per cent in April and 9.1 per cent in the following month.
RBI said given the recent pattern, inflation numbers for April and May are likely to be revised upward.
In the mid-quarter monetary policy review on Thursday, the central bank raised its short-term lending rate, or repo rate, by 25 basis points to 7.5