PHDCCI welcomed the RBI’s policy rate hike after 44 months and its shift to calibrated tightening, but called for future monetary decisions to remain data-dependent. It also stressed maintaining credit flows to productive sectors amid inflation, geopolitical and energy-price uncertainties
Economists expect the RBI to begin raising interest rates at its October MPC meeting, bringing forward forecasts from December. Higher crude prices, broadening inflation, rising global bond yields and geopolitical risks are strengthening the case for a 25-basis-point hike
Economists expect the RBI’s inflation mandate and tighter liquidity conditions to increase the likelihood of rate hikes in October and December. Sustained liquidity absorption through VRRRs, OMO sales and FX swaps has reduced excess liquidity, strengthening monetary policy transmission
