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Below a quote by Rajani Sinha, Chief Economist, CareEdge Ratings sharing her views on the RBI's policy meeting

“RBI’s decision to maintain the status quo on the policy rate was on the expected lines. However, it sounded more cautious than the last two meetings, with a significant upward revision in the inflation numbers for the upcoming quarters. Given the transient nature of the seasonal shocks, the RBI will wait for more data points to evaluate the emerging inflation dynamics and will likely look through any temporary rise in inflationary pressures in the near term. With the steep upward revision in the inflation projections, the expectation of a rate cut is pushed further to the next fiscal. Additionally, the announcement of a temporary provision of incremental CRR will help remove the build-up of excess liquidity in the system”, said Rajani Sinha, Chief Economist, CareEdge Ratings.

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