RBI monetary policy 2018: Arm yourself with these top 10 points ahead of announcement
RBI monetary policy 2018: The Reserve Bank of India (RBI), which will announce its third bi-monthly monetary policy review statement today, may raise interest rates while retaining a neutral policy stance, according to a big majority of analysts. The RBI is expected to strike a balance between rising inflationary pressures and still recovering growth. Ahead of the announcement, disappointing quarterly results pulled the key indices of the Indian equity market lower during the late-morning trade session on Tuesday. Here are 10 key points to know prior to the RBI's policy announcement.
3. Last week, 37 of 63 economists in a Reuters poll said the RBI will raise rates on Wednesday, while 22 said the next hike would come later this year, or early in 2019. "Since the RBI is committed to bringing down inflation, they don`t have a choice but to raise rates," Rupa Rege Nitsure, group chief economist at L&T Finance Holdings, told Reuters. Image source: Reuters
5. Global crude oil prices have surged nearly 20 percent this year and crossed $80 a barrel in May, their highest since 2014. This has driven the prices of fuel - the biggest item on India`s import bill - to record highs at a time the rupee is testing new life lows, raising the threat of imported inflation, Reuters said. Image source: Reuters
8. The monetary policy committee "could afford to do a 'wait and watch' at this juncture and consider more data points before a rate action," Lakshmi Iyer, Kotak Mutual Fund`s chief investment officer debt, told Reuters, adding "There might not be much urgency in delivering back-to-back rate hikes when the policy stance is still neutral." Image source: Reuters