25 per cent in its third bi-monthly monetary policy review on Wednesday, say experts and bankers.25 per cent for the fourth straight time citing risk to inflation, to change its monetary stance and may even go for an aggressive rate cut.However, factory output slumped to 1.As always, India Inc has been pitching for the rate cut to stimulate growth.Encouraged by significant price improvement, bankers expect RBI, which has kept rates on hold at 6.Echoing similar views, Indian Bank Managing Director Kishor Kharat said there is an expectation that there could be 0.”Yes, inflation has come down, but will it remain at this level? We all know that given the base effect change, it will go up to some extent.1 per cent in the January-March quarter — its weakest pace in more than two years,” it said.The six-member monetary policy committee (MPC) of the RBI headed by RBI Governor Urjit Patel will announce the outcome of the meeting on August 2 afternoon.7 per cent in May, from 8 per cent a year ago due to poor performance of mining and manufacturing.
Private sector Kotak Bank is of the opinion that since the RBI has revised down its inflation trajectory sharply in the June policy, and given that inflation reading, the central bank has some room to be accommodative.5 per cent with a downward bias, the report added.5 per cent between December and March.”The deceleration in factory output growth could further bolster the case for a rate cut next month to boost Asias third-largest economy, which grew 6. Global Research firm Bank of America Merrill Lynch (BofAML) too expects the MPC to cut rates by 25 basis points (0.One of the MPC members, bathtub suppliers Ravindra Dholakia, however, had advocated a 50 basis point cut in the repo rate, saying several noteworthy developments recently on prices and output fronts warrant a decisive policy action..In the MPC, RBI Governor Urjit Patel had argued for avoiding “premature policy action” and waiting for more inflation data.25 percentage point).”The expectation is of rate cut of a minimum 25 basis points as inflation has eased and also as industrial growth continues to remain weak.Commenting on the retail inflation data, Chief Economic Advisor Arvind Subramanian had said the “paradigm shift” in inflationary process has been missed by all, who have made “systematic inflation forecast error”, apparently referring to the RBI.
The wholesale price inflation for the month too has dropped to eight month low. The RBI may not touch Cash Reserve Ratio or Statutory Liquidity Ratio as there is adequate liquidity in the market, Kharat added.”We expect the MPC to cut repo rate by 25 basis points in the August meeting,” the bank said in a report.New Delhi: With retail inflation receding to record low levels, the Reserve Bank is likely to cut the benchmark lending rate by at least 0.54 per cent in June.For 2017-18, CPI inflation average could thus be below 3.According to HDFC Bank Managing Director Aditya Puri, there is always a case, but there are a number of members on the committee who will examine it. Is there still a case for a decline in interest rates? I think most people think so.The retail inflation, which the RBI mainly factors in while deciding interest rate, has declined to historical low of 1. A rate cut will give a push to credit growth which has been sluggish from last many quarters,” Bank of Maharashtra Managing Director R P Marathe said.”Incoming data is expected to provide greater clarity on the durability of recent food and non-food disinflation,” he had opined.
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