New Delhi, April 9 -- The Gulf war's two-week break for truce talks has spelt relief for the global economy. But until a reliable peace pact is forged, hostilities could erupt again-even before the West Asian dust-up settles to offer us some clarity on its impact. So, it was sensible of the Reserve Bank of India (RBI) to have held its monetary policy steady.

As widely expected, its rate-setting panel voted in unison to hold the repo rate-at which RBI lends short-term money to banks-unchanged at 5.25%. The rates at which it absorbs and injects liquidity (in last-resort cases) stay a quarter of a percentage point below and above that key rate, respectively.

The news of a ceasefire had broken only hours before RBI's policy announcement; th...