InvestorQ : What are the expectations from the monetary policy of the RBI in December? Do you expect anything on the rates front?
Neelam Naik made post

What are the expectations from the monetary policy of the RBI in December? Do you expect anything on the rates front?

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Anu Biswas answered.
6 months ago
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We are up against one more monetary policy and this time around the expectations are quite muted. The Reserve Bank Monetary Policy Committee or MPC is expected to keep the benchmark interest rates unchanged when it meets between 02-Dec and 04-Dec.

The meeting will culminate in the monetary policy announcement on Friday. However, considering the overall economic contraction, RBI is likely to continue with the accommodative monetary stance. It may be recollected that the RBI has already ruled out any rate hikes on the back of higher inflation.

In the previous policy in October, RBI had kept policy rates unchanged to help tame inflation but it had also hinted that accommodative stance could continue till 2022. One of the MPC members had objected to this kind of a blank cheque but then majority had prevailed.

CPI inflation continued to rise for the ninth straight month in a row touching 7.61% in October on higher food prices. There also appears to be problem as the farm-level infrastructure, which is not allowing the free flow of goods to the market. So there could be a statement on accommodative policy but nothing more than that.


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