The Reserve Bank of India (RBI) kept its key policy rates and monetary policy stance unchanged, while flagging heightened inflation risks, prompting economists to closely watch the central bank’s next moves amid evolving domestic and global economic conditions. Reacting to the monetary policy announcement, Upasna Bhardwaj, Chief Economist at Kotak Mahindra Bank, said the RBI’s decision to maintain rates and stance was largely in line with market expectations. However, she noted that the central bank’s emphasis on amplified inflation risks indicates continued vigilance on price pressures and the broader macroeconomic environment.
Bhardwaj said Kotak Mahindra Bank expects a cumulative 50 basis points rate hike cycle beginning in October as the RBI seeks to contain inflation and maintain macroeconomic stability. According to her, the central bank’s commentary suggests that inflation remains a key concern despite the decision to leave rates unchanged in the current policy review.
On the positive side, she said measures announced by the RBI to attract capital inflows would help ease pressure on the Indian rupee. Improved capital inflows are expected to support currency stability and strengthen investor confidence amid global market uncertainties. In Kolkata, financial institutions, traders and businesses are likely to closely monitor upcoming RBI policy actions. Market participants believe that any future rate hikes could influence borrowing costs, investment decisions and credit demand across sectors, while measures supporting capital inflows may provide additional confidence to investors in the city.
