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With inflation in India ticking higher it may be time for RBI to pause

Some economists and market insiders argue it may be prudent for the MPC, the policy committee, to hold its fire when it meets early next month

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The spike in the retail inflation rate above the RBI's mandated 2%-4% target range is another reason for the central bank to take a breather, analysts say.

Reuters Mumbai

3 min read Last Updated : Jul 16 2020 | 12:37 PM IST

With India's economic growth sputtering, the Reserve Bank of India was expected to maintain a rate-cutting cycle, but an uptick in near-term inflation could give the central bank's Monetary Policy Committee reason to pause for now.

Having cut its key lending rate by an aggressive 115 basis points (bps) in 2020, on top of 135 bps cuts in 2019, the RBI so far has had little success in spurring credit growth amid varying degrees of lockdowns across India.

Some economists and market insiders argue it may be prudent for the MPC, the policy committee, to hold its fire when it meets early

Topics : Inflation Indian Economy MPC

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