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The Indian central bank kept policy...........>

INDIA
INDIA: The Indian central bank kept policy unchanged (alongside expectations) as
still hot inflation tied the bank's hands despite a board that's likely still in
favour of further policy easing.
- In lieu of another rate cut, the bank have attempted to boost credit supply in
India by loosening bank's cash requirements on certain loans, boosting liquidity
supply and freeing up lending rules for SMEs.
- The decision resulted in a decent fall in the Indian sovereign yield curve and
supported regional equities but the read-through for INR was more limited.
- This keeps focus on inflation going forward, with markets now watching for a
pullback in CPI to the bank's 2-6% target which would provide the greenlight for
more headline policy easing.
- January CPI is due on February 12th. Early estimates are for an above-target
7.4% reading.

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