Inflation fight, monsoon may take pressure off RBI: Former deputy governor

The govt's recent $26-bn fiscal package, which includes tax cuts and subsidies, as well as the RBI's rate increase earlier this month, should be able to cool inflation to 6%, says R Gandhi

India’s coordinated fiscal and monetary efforts to tame inflation, plus a good agricultural production outlook, may take pressure off the central bank to aggressively raise interest rates later in the year, according to a former Reserve Bank of India official.

Interest rate increases by the RBI “should be very moderate” after an expected 50 basis point rise at its next meeting in June, Rama Subramaniam Gandhi, who was a deputy governor from 2014 to 2017, said in a Bloomberg Television interview on Monday. 

The government’s recent $26 billion fiscal package, which includes tax cuts and subsidies, as well as the