India rate cuts bets fall as recovery gains hold, inflation stays high

With inflation above 7% in Oct for a second straight month, well above RBI's medium term target of 4%, views that India is near the end of the current rate cutting cycle have become more pronounced

Negative real rates in India and recovering growth alongside high inflation suggest its central bank has little room for more monetary stimulus, but policy is likely to stay accommodative, economists and analysts said.

Industrial production in September grew for the first time in six months while green shoots are also visible in rising goods and services tax collections, higher energy consumption, and an uptick in the purchasing managers' index among other gauges.

With inflation staying above 7% in October for a second straight month, well above the RBI's medium term target of 4%, views that India is near the end of the