With Raghuram Rajan set to deliver his last monetary policy on Tuesday, most brokerages as well economists seem to be united that a parting gift in terms of a rate cut is unlikely by Rajan.
“We expect the RBI to leave the repo rate unchanged at 6.5% in August, while maintaining a cautiously accommodative policy stance. Since the RBI’s previous policy meeting in June, retail (CPI) and wholesale (WPI) inflation have surprised on the upside, while global uncertainties increased further, primarily following Britain’s decision to leave the European Union,” Barclays said in a note.
ICICI Bank Global Markets also believes that it is likely to be a status quo.
BofA-ML, however, is certainly optimistic and expects Rajan to deliver another rate cut to end his tenure.
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