As India continues to battle the scenario of low growth and high inflation, Raghuram Rajan surprised the market by keeping key rates unchanged. In its mid-quarter monetary policy meet on Wednesday, the Reserve Bank of India left repo rate unchanged at 7.75 percent and CRR at 4 percent.
A total of 90 percent respondents of a CNBC-TV18 poll on expectation from the RBI monetary policy had voted for a 25 bps rate hike.
Despite tight monetary policy aimed at kill pricing power, inflation has risen thick and fast. The November WPI inflation touched 7.5 percent driven by a spike in food prices, beating the street consensus of 7 percent. November CPI inflation too came in at 11.2 percent versus an expectation of 10.6 percent. However, core WPI inflation (ex food, oil and metals) has stayed at 3.5 percent, pretty much at last month’s levels.
A total of 90 percent respondents of a CNBC-TV18 poll on expectation from the RBI monetary policy had voted for a 25 bps rate hike.
Despite tight monetary policy aimed at kill pricing power, inflation has risen thick and fast. The November WPI inflation touched 7.5 percent driven by a spike in food prices, beating the street consensus of 7 percent. November CPI inflation too came in at 11.2 percent versus an expectation of 10.6 percent. However, core WPI inflation (ex food, oil and metals) has stayed at 3.5 percent, pretty much at last month’s levels.
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