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Economy — Inflation — Economics — Monetary Policy — Interest Rates — Finance

Rate Hike Odds Rise as Inflation Breaches RBI’s Target Again

Retail inflation rose 6.44% in February, above the RBI's target of 6.00%. RBI likely to increase the benchmark rate to 6.75%, a 7-year high. Food prices rose 5.95%, 'fuel and light' rose 9.90%, and core inflation stayed above 6% for 17th month in a row.

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  • Retail inflation rose 6.44% in February, above the RBI's target of 6.00%.
  • RBI likely to increase the benchmark rate to a 7-year high of 6.75% at April 6th meeting.
  • Food prices rose 5.95%, while 'fuel and light' rose 9.90%, and core inflation stayed above 6% for 17th month in a row.
  • RBI has raised the policy rate by 250 basis points since May 2022.
  • Growth-inflation trade off has divided the MPC, with two members calling for a pause in February.
Rate Hike Odds Rise as Inflation Breaches RBI’s Target Again
India’s retail inflation breached the central bank’s target for a second straight month in February, raising odds of further monetary tightening even as markets weigh the fallout of Silicon Valley Bank’s collapse.
BloombergVrishti Beniwal

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