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MNI RBI Preview - August 2024: No Change, Focus Remains On Policy Bias

RBI
  • The RBI is widely expected to keep rates on hold tomorrow. This is the firm economic consensus and our own bias. Headline inflation outcomes remain sticky, while growth is holding up resiliently.
  • This is likely to leave greater focus on the policy bias from the RBI. We see risks of the ‘withdrawal of accommodation’ stance being removed, but the August meeting might be too soon for such a shift. The RBI is likely to want to see further progress on inflation towards the mid-point of the 2-6% target range before shifting to neutral. Such a viewpoint is also the rough sell-side consensus.
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