Lesser rate hikes will be needed if CPI falls below forecasts: Ashima Goyal

Liquidity should be in surplus as long as Fed's quantitative tightening continues

Several factors, including a decline in global crude oil prices, point to the likelihood of future inflation readings falling below the Reserve Bank of India’s forecasts, Ashima Goyal, a member of the Monetary Policy Committee told Business Standard’s Bhaskar Dutta. If inflation does indeed come in below the RBI’s projections, less of a rise in rates will be required, Goyal said.

Edited excerpts:

You have mentioned in the recent MPC minutes that growth has sustained despite rate increases and global shocks. The RBI is projecting CPI inflation above 6% till Jan-Mar. Does this call for more frontloading of rate hikes?