RBI kept interest rates unchanged in December 2021 & in February 2022because Ministry of Finance is building an “escape clause,” allowing inflation to increase above the target goal of 4%.
Recovery in Asia’s third-largest economy is facing fresh challenges from the war in Ukraine and Covid lockdowns in China, which risk exacerbating a global supply squeeze and price pressures.
Michael Patra's rebuttal follows several economists expressing doubts over RBI’s benign inflation forecast even though oil prices are surging and demand returns as pandemic curbs are eased.
The Reserve Bank of India’s move last week to keep the rates unchanged surprised markets, which had expected the bank to raise them to begin policy normalization after Covid.
The currency is likely to have stable value, limiting appeal as an asset. It may be safer than holding cash, but tech, connectivity will pose issues, if meant for wide use by households.
Citigroup sees RBI lifting repo rate no earlier than October, versus its earlier August prediction. HSBC shifts to July-September from April-June, and Barclays moves to August from April.
Temba Bavuma highlighted the irony of facing racism in India, a brown-skinned nation that had stood firmly against apartheid. If there was ever a figurative slap in the face, this was it.
While global corporations setting up GCCs in India continue to express confidence in availability of skilled AI engineers, the panel argued that India’s real challenge lies elsewhere.
Without a Congress revival, there can be no challenge to the BJP pan-nationally. Modi’s party is growing, and almost entirely at the cost of the Congress.
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