RBI Policy: Rate Cut to be in line with inflation Target, say experts

All eyes will be on the interest rate decision Tuesday by the newly constituted Monetary Policy Committee (MPC) headed by RBI Governor Urjit Patel. In an interview to CNBC-TV18 Jahangir Aziz, Asia Economic Research at JP Morgan, Willem Buiter, Global Chief Economist at Citi and Deepali Bhargava, Economist at Credit Suisse talk about their expectation from the MPC. 

 

Aziz is of the view that RBI is operating in an inflation targeting framework and they will decide on rate cuts with an eye on their 4-percent inflation target. However, the house will be keenly watching for any change in language in terms of trajectory for inflation and growth. 

 

Buiter who was a teacher to the RBI governor Urjit Patel does not expect him to be either hawkish or dovish because according to him, Patel has been the principal architect of flexible inflation targeting that India has adopted and so, expects him to remain true to that arrangement. 

 

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