RBI to maintain status-quo, deliver a neutral tone this Friday – Deutsche Bank

In the view of the Deutsche Bank Chief Economist Juliana Lee, the Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) is expected to maintain status-quo on the interest rates, although the tone may turn neutral in December when compared to a dovish tilt that was seen in October.

Key quotes

“Upside surprises to recent high-frequency data and progress on the vaccine front should keep RBI on the sidelines, while slowly shifting its attention to inflation management.”

“MPC policy decision due on Friday, market participants expect status quo as inflation stays elevated.”

“MPC had cut rates by 115 basis points in March-May, but has maintained pause on rates since then.”