<h1>RBI's 2011-12 Q2 Monetary Policy Review: Repo Rate Hike to 8.5%, Inflation Control, Financial Stability, and Inclusion Focus.</h1> The Reserve Bank of India's Second Quarter Review of Monetary Policy for 2011-12 highlights global economic slowdown, particularly in the US and euro area, impacting emerging market economies like India. Despite a decline in commodity prices, inflation remains high in India, driven by domestic demand and structural issues. The policy aims to balance inflation control with growth stimulation, maintaining interest rates to anchor inflation expectations while encouraging investment. Key measures include a 25 basis point increase in the repo rate to 8.5% and deregulation of savings bank deposit interest rates. The review also addresses financial stability, regulatory frameworks, and financial inclusion initiatives.