Dhaka, Oct. 3 -- The Reserve Bank of India (RBI) kept its policy rate unchanged on Wednesday, signalling room to lower rates in December as it assesses the impact of domestic tax cuts and punitive US tariffs on the South Asian economy.

The central bank said low inflation had "opened up policy space for further supporting growth," after its six-member Monetary Policy Committee (MPC) voted unanimously to hold the repo rate at 5.50 percent and retained a "neutral" policy stance, reports India has faced US tariffs of up to 50 percent on key exports, ranging from textiles to chemicals, but consumer tax cuts announced by Prime Minister Narendra Modi's government are expected to bolster growth and suppress inflation.

"The current macroeconomic...