RBI's August Monetary Policy Committee Meeting: Expert Insights on Expected Changes
The Reserve Bank of India (RBI) is likely to keep the interest rates unchanged in its upcoming meeting.
The Reserve Bank of India (RBI) is likely to keep the interest rates unchanged in its upcoming meeting. While the US Federal Reserve and the European Central Bank have raised rates, it is expected that RBI will not increase rates during its bi-monthly policy review.
Experts believe that inflation in India is under control, and the RBI has maintained the benchmark interest rates in the last two policy reviews. Borrowing costs for people had started to increase in May of the previous year, but the RBI kept the repo rate at 6.5% and later reduced it to 6.25% in February.
The Monetary Policy Committee (MPC), led by RBI Governor Shaktikanta Das, will meet on August 8 and announce its policies on August 10. The committee meets every two to three months, and any changes are revealed during a press conference on the third day of the meeting.
Experts expect that the RBI will maintain the current rates and policy stance because inflation is currently below 5%, but there might be a risk of higher inflation due to increasing prices of vegetables and pulses in the future.
Upasna Bharadwaj, Chief Economist at Kotak Mahindra Bank, predicts that the RBI will continue its current policy of reducing liquidity in the market after the demonetization of the Rs 2,000 note.
Aditi Nayar, Chief Economist at the Investment Information and Credit Rating Agency (ICRA), anticipates that retail inflation (Consumer Price Index) will likely exceed 6% by the end of the month.
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