This Article is From Nov 27, 2014

RBI to Acknowledge Improved Outlook for Inflation: CLSA

RBI to Acknowledge Improved Outlook for Inflation: CLSA

The Reserve Bank will indicate it is better positioned to achieve CPI inflation forecast of 6 per cent for January 2016, in its policy review, says CLSA.

This will be a change compared to the indication of upside risk to that forecast in the previous policy statement.

CLSA said rates are widely expected to be kept on hold.

The central bank will likely leave its key repo rate on hold in its December 2 meeting, according to a Reuters poll.

However, Indian markets are pricing in a rate cut despite wary RBI.

CLSA says government actions to facilitate investment are more important for revival than a token monetary easing.

It added that pick-up in growth in the near term will be gradual and uneven.

CLSA noted the divergence between the Nifty and the real economy will persist for some more time.


Copyright Thomson Reuters 2014