Zee Media Bureau
New Delhi: Having already cut the repo rate by a sharper 50 basis points during its last meet, the Reserve Bank of India (RBI) will announce its bi-monthly monetary policy review on Tuesday amid continuous concerns over the spiraling inflation.
Also read: RBI monetary policy review today, rate cut unlikley
Here's what the experts think about today's credit policy announcement.
A. Prasanna, an economist at ICICI Securities Primary Dealership Ltd in Mumbai, doubts that Indian interest rates can be cut before April. "It is very difficult for inflation to sustain below 5 percent in India," he said.
Also Watch:
"I think Rajan will wait for the Fed move. He will not change the rates," UCO Bank Managing Director and Chief Executive R K Takkar said.
Also read: RBI revises oversees borrowing limits for India Inc
Analysts at American brokerages Citi and Bank of America Merrill Lynch also ruled out any surprise this time. "We expect Rajan to pause on Tuesday, given the 50 bps surprise cut last time. He should cut a final 25 basis points in February," BofA-ML said in a research note.
Citi also echoed similar views saying "following the 50 bps front-loading in September, RBI will maintain status quo on Tuesday as significant uncertainty exists ahead of December Fed and the upcoming Budget."
Also read: India's economic growth seen picking up, RBI may hold rates steady
Trade body Assocham also expects the apex bank to keep the benchmark rate unchanged, with the Middle East already in turmoil after Turkey shot down a fighter jet of Russia.
"Fast changing geo-political situation in the Middle East and the increased terror threat with consequent economic costs will surely weigh on the RBI's policy stance which is not expected to give any more cut in the interest rates in the upcoming review," it noted.
With Agency Inputs
