RBI policy: How the Indian stock market is expected to react tomorrow
RBI) is underway and it will conclude on Thursday (August 10). Experts believe the domestic market may not see any significant reaction to the RBI MPC outcome if the central bank maintains a status quo on rates and monetary policy stance. Experts believe the RBI will maintain a status quo on rates and stance on August 10.
According to a Mint survey of 10 economists, RBI MPC is likely to leave interest rates and policy stance unchanged at its meeting this week. All economists expect MPC to keep the repo rate unchanged at 6.5 per cent and retain the stance of withdrawal of accommodation. While the majority expects RBI to maintain a prolonged pause after the August policy, the market is pencilling in a 50 per cent chance of 25 basis points (bps) hike over the next two RBI meetings.
Read more: RBI rate, stance to stay on pause: Poll "The upcoming MPC policy will see the RBI reiterating caution amid a spike in perishable food prices, even as easing core inflation and possible mean reversion in food price trends in Q4CY23 would keep the RBI on hold, with a focus on the durable elements of inflation," said Madhavi Arora, Lead Economist atEmkay Global Financial Services. Umesh Kumar Mehta, CIO of Samco Mutual Fund also expects a status quo by the RBI this week, but the odds of interest rate hike or cut is equally poised going ahead. "Global economic and inflationary environment is still not up to the mark because of renewed strengthening of crude oil prices and surge in global food prices on extreme weather conditions.
Fed and RBI alike suggest a 'when the facts change, I change my mind' mode. So, it is expected that going ahead only data will decide the course and fate of interest rate," said Mehta. Read more: RBI MPC may
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