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RBI To Maintain Status Quo In Next Policy Meet


After maintaining status quo with repo rates being kept at 6.25%, RBI also held a gradual tightening stance in light of the liquidity condition.

RBI To Maintain Status Quo In Next Policy Meet

Nonetheless as per a report, in its next policy meet, slated to be held next month, the RBI is likely to again hold rates steady as rising agricultural produce and easing oil price is likely to be accounted for.

Also, the softening in vegetable and fruit prices will help keep food inflation low. As per D&B report, CPI and WPI inflation for the month of November will stand at 2.8-3% and 4.8-5% respectively. "The risks emanating from global crude oil prices have eased to an extent as oil prices are likely to fall or remain subdued in the near term. This has partially dispelled concerns over one of the primary factors affecting India's current account deficit, fiscal slippage and inflation ". Dun & Bradstreet India Lead Economist Arun Singh said.

Other factors at play that are likely push growth and held the central bank stick to current rates is the sharp appreciation in rupee, industrial production pacing at a healthy rate and favourable inflation rate. Nonetheless, few of the triggers that could be detrimental include stringent regulations for the non-banking finance sector which is seen facing liquidity headwinds after IL&FS crisis and burgeoning NPAs in the banking sector cannot be ignored.

Read more about: rbi repo rate inflation
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