RBI likely to maintain status quo on policy rates as inflation still high: Experts

livemint.com:

ALSO READ: India's forex reserves near 4-month low; declines $867 million to $593.037 billion: RBI Data "We do expect the RBI to hold on to a status quo position this time as inflation is still high and liquidity tight. Going by RBI forecast on inflation, it would be above 5 percent in Q3 too, which will ensure that the status quo prevails for the calendar year for sure and probably Q4 too," said Madan Sabnavis, Chief Economist, Bank of Baroda.

Exciting news! Mint is now on WhatsApp Channels :rocket: Subscribe today by clicking the link and stay updated with the latest financial insights! Click here! Paste this on click here: https://whatsapp.com/channel/0029Va91YSeGehEM6oMesj3d Sabnavis further said there are uncertainties relating to the Kharif crop, especially on pulses, which can increase prices. "The comfort is that there is less concern on growth which is on target," he added.

In August, the Consumer Price Index (CPI)--based retail inflation eased a bit to 6.83 percent from 7.44 percent in the preceding month in July, it remained above the Reserve Bank's comfort level of 6 percent. The government has mandated the RBI to keep inflation at 4 percent with a 2 percent margin on either side.

As per Aditi Nayar, Chief Economist, ICRA Limited, the CPI inflation is expected to ease to 5.3-5.5 percent in September 2023 from 6.8 percent in August 2023, benefitting from the halving of the average price of tomatoes as well as a favorable base. "...