If anybody was expecting a rate cut soon, here is a reality check: The minutes of the monetary policy committee (MPC) meeting show that Viral Acharya, deputy governor of the Reserve Bank of India (RBI), said, “I am, however, likely to shift decisively to vote for a beginning of withdrawal of accommodation in the next MPC meeting in June." This is perhaps the strongest guidance given by an MPC member ever.

None of the members have lowered their concerns over inflation. The elephant in the room—minimum support price hike—has been recognized and called out by all.

Surprisingly, a softer note on inflation comes from RBI governor Urjit Patel apart from the dovish Ravindra Dholakia.

Patel elaborates on the recent benign trend in retail inflation but he too balances it out with warnings on upside risks. While some members believe that growth impulses are not entrenched, others such as Dholakia feel that growth still needs a helping hand from monetary policy.

Acharya rightly points out that monetary policy needs to separate signal from noise with regard to data. He explains that the fall in headline inflation was driven by food and that monetary policy should look through it.

Core inflation and the worries it brings to policymakers is back firmly on the central bank’s radar. Acharya, Chetan Ghate and Michael Patra flagged the rise in core inflation over the past three months.

In hindsight, we now see there was nothing dovish about the policy announcement earlier this month. The bond markets have been wise enough to separate the signal from the noise surrounding monetary policy. Yields have already climbed sharply after a short-lived rally.

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