Mumbai: The 12 rate hikes by the Reserve Bank in the past 18 months have failed to hurt growth in aggregate demand, as households' current borrowing levels are low and they have sufficient liquidity to absorb the increased interest rates, says leading financial services agency CMIE. Therefore, core inflation will continue to remain high at about 8 percent for the fiscal ending next March, the Centre for Monitoring Indian Economy (CMIE) said in its monthly review. "Though the RBI's interest rate hikes have been transmitted well, with banks responding to the announcements by passing on the rate hikes to borrowers, these hikes do not seem to hurt the growth in aggregate demand," CMIE said. This, according to the agency, is because the "households are not yet sufficiently leveraged for their demand to be impacted by the hike in interest rates". According to estimates made by the CMIE, based on responses from about 1,50,000 randomly selected households, less than 15 percent of households were borrowers last fiscal. Furthermore, loan servicing by households (in the form of equated monthly installments, or EMIs) constituted less than 1 percent of the total income of households. The report further says that while leveraged consumption demand from the households is expected to be hurt, the impact of the rate hikes on aggregate demand is likely to be too small to make a difference. Due to repeated rate hikes by the RBI, average base rates have risen from 7.9 percent in August, 2010, to 10.5 percent in August this year, the report said. The RBI has raised interest rates 12 times in the past 18 months. During this period, inflation, as measured by the wholesale price index, declined from 10.9 percent to 9.8 percent in August.