The Reserve Bank of India at its third bi-monthly Monetary Policy kept the benchmark repo rate unchanged at 7.25 percent  and  cash reserve ratio (CRR) at 4 percent. Consumer price index (CPI) inflation rose for the second straight month in June 2015 to a nine-month high of 5.4%;Consumer inflation target for Jan-March 2016 cut by 0.2%  mostly on lower crude prices and good monsoon.RBI kept the room for further rate cuts by keeping  growth revival and FED rate outlook in consideration.Urban consumption demand seems to be picking up shown by  stronger July Car sales data.However  Signals from the services sector were mixed.The pick-up in heavy commercial vehicle sales and rising port and domestic air freight in Q1 suggest strengthening transportation activity .RBI keep watch on the effect of hike  in service tax which came effect from  June 2015, looking for its full fledged out turn  in the coming year.RBI is heedful of torpid exports as well as supply constraints.