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RBI: MNI RBI Preview - October 2024: No Change, Policy Bias In Focus

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EXECUTIVE SUMMARY

  • Only four economists surveyed by Bloomberg expect a cut at tomorrow’s policy meeting. The other surveyed (just under 40) expect a steady policy outcome. This is also our firm bias, which would leave the policy rate at 6.50%. Greater focus is likely to rest with the RBI’s policy bias and the look ahead given global volatility, some rebound in oil prices and the growing interest rate differential given the US Federal Reserve’s cut in interest rates.   
  • The growth outlook remains sufficiently resilient to remain on hold but carefully watching the outlook for Global geo-politics, the impact of the cut from the Federal Reserve, the flow on effect of the recently announced China stimulus and the currency.
  • Given how large food prices are in terms of the CPI basket, the RBI may also want to see a more encouraging trend on this front before gaining confidence in sustaining its inflation target.
  • Full preview here: RBI Preview - October 2024 .pdf
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EXECUTIVE SUMMARY

  • Only four economists surveyed by Bloomberg expect a cut at tomorrow’s policy meeting. The other surveyed (just under 40) expect a steady policy outcome. This is also our firm bias, which would leave the policy rate at 6.50%. Greater focus is likely to rest with the RBI’s policy bias and the look ahead given global volatility, some rebound in oil prices and the growing interest rate differential given the US Federal Reserve’s cut in interest rates.   
  • The growth outlook remains sufficiently resilient to remain on hold but carefully watching the outlook for Global geo-politics, the impact of the cut from the Federal Reserve, the flow on effect of the recently announced China stimulus and the currency.
  • Given how large food prices are in terms of the CPI basket, the RBI may also want to see a more encouraging trend on this front before gaining confidence in sustaining its inflation target.
  • Full preview here: RBI Preview - October 2024 .pdf