Hobson's choice before the Reserve Bank...

... between a harder forward premium and a sharp decline in the domestic rates

Till Reserve Bank of India (RBI) Governor Shaktikanta Das said in his recent interviews that shifting of the stance of the monetary policy from neutral to accommodative itself meant a rate cut of 25 basis points (bps) at least and, therefore, effectively, the rate cuts have been 100 bps, every analyst and his aunt were penciling yet another rate cut on August 7. 

Even now, against the backdrop of the US Federal Reserve’s rather hawkish rate cut, a 25 bps drop in policy rate could be on the table in India as core inflation is modest, overall retail inflation remains below