India’s unemployment rate came down to 6.43 percent in September, from a one-year high in the previous month, according to data from the Centre for Monitoring Indian Economy (CMIE). In August, the unemployment rate — or the percentage of unemployed people in the labour force — had stood at 8.3 percent.

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”In September, the unemployment rate has fallen significantly with an increase in labour participation in both urban and rural areas,” said Mahesh Vyas, Managing Director, CMIE.

In August, the rate had spiked owing to a fall of two million in employment sequentially to 394.6 million, according to the private think-tank.

The latest CMIE reading comes a day after the RBI brought down its GDP growth forecast for the country's economy to 7 percent from 7.2 percent for the year ending March 2023.

However, it raised its forecast the economy to expand 7.2 percent in the quarter ending June 2023, as against 6.7 percent previously.

The RBI's Monetary Policy Committee raised the repo rate — or the key interest rate at which it lends short-term funds to commercial banks — by 50 basis points to 5.9 percent, and decided to continue with its current stance of “withdrawal of accommodation”.

RBI governor Shaktikanta Das warned of more rate hikes in the coming months, as inflation continues to reel beyond its target range.

Most economists cheered the absence of surprises in the RBI policy statement.

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India's GDP expanded 13.5 percent in the April-June period compared with the corresponding three months a year ago. The growth rate, however, fell short of expectations of 15 percent by economists polled by CNBC-TV18.