Markets confused by RBI's core inflation focus, says Murthy Nagarajan

The Reserve Bank of India is the country's central bank - like a big bank for banks - and it decides interest rates.

Interest rates are the price you pay to borrow money.

When prices of things go up, which is called inflation, the central bank usually makes borrowing costlier to cool things down.

This week, the RBI made a decision about rates that confused stock market experts.

The RBI said it watches overall inflation, but its words suggested it was really watching 'core' inflation, which excludes food and fuel.

One expert, Murthy Nagarajan, said the RBI is probably waiting because there is too much uncertainty - a war, less rain than usual, and changing oil prices.

He thinks the RBI will not raise rates for a while, even though prices are expected to rise faster than the current interest rate.

He expects rates to start going up around December, and that India's bonds might soon be added to a big global index.

Basically, the RBI is keeping its options open and watching how things play out.