Economists expect higher rate hikes after RBI's hike to tame inflation

India's central bank is expected to frontload more aggressive interest rate hikes in its effort to tame high inflation, at least until its repo rate hits its pre-COVID level of 5.15%, economists said after a long-anticipated rate hike on Wednesday.

Most economists are now forecasting a cumulative 125-150 basis points of rate hikes over the next 12 months, compared with about 50 basis points expected three months ago, on the grounds that inflation could remain around 7% for at least three months more due to soaring global energy, food, and manufacturing prices.

The Reserve Bank of India's Monetary Policy Committee