The Reserve Bank will hold the rates for the remainder of the fiscal year ending March 2019 and is likely to go for “measured hikes” in FY20 as inflation inches up, Singaporean lender DBS has said.
Decision on rates will be majorly influenced by the movement in oil prices and also the currency, which were termed as “wildcards” by its house economists.
In a report that comes days after the headline inflation print eased to a surprising 3.31 per cent for October, the lender lowered its consumer price inflation (CPI) expectations for FY19 to 4 per cent from 4.4 per cent earlier.
It can be noted that under its medium term inflation targeting framework, the RBI is committed to anchor the price rise at 4 per cent with a leeway on either side.