India: RBI expected to hike rates this week – UOB

Economist at UOB Group Lee Sue Ann suggests the RBI could raise its repo rate at its meeting later this week.

Key Quotes

“With the policy priority on containing inflationary pressures from second-round effects of supply side shocks and anchoring long term inflation expectations, there is more room for the RBI in its rate hike trajectory.”

“After kicking off with the surprise unscheduled 40bps move on 4 May and the 50bps Jun hike, we think that the RBI will add on another 75bps rate increases in the rest of 2022 to bring the repo rate to 5.65% by the end of this year.”

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