Quote on MPC expectations and interest rate outlook by Rajeev Sharan, Head of Research, Brickwork Ratings
Below the Quote on MPC expectations and interest rate outlook by Rajeev Sharan, Head of Research, Brickwork Ratings
"The rate cycle looks to be turning. After holding through 2026, the RBI faces growing pressure to raise rates at its October review, and a 25 basis point hike to 5.50% is now a real possibility, which would be the first increase since early 2023. The case for moving higher has strengthened: retail inflation has climbed to 4.82% and is set to peak around the festive quarter, crude is holding above USD 100, the rupee has slipped past 96, and the Fed's recent hike has narrowed the rate gap and added to currency pressure. On the other side, inflation is still within the target band and price pressures are not yet broad-based, which could persuade the committee to hold once more with a firmly hawkish tone. Either way, a rate cut is off the table for now, and the next move is more likely up than down."
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