Time for MPC to shift its policy stance
Adjusting the monetary stance sooner with a gentle pace of rate increases is tactically better than being forced into stepped-up tightening following a delayed shift in the stance
A key focus next week is the meeting of the monetary policy committee (MPC) of the Reserve Bank of India (RBI). Will it hike the policy repo rate again, after having caught most economists off-guard by raising it at the last meeting in early June? Further, will it shift to a tightening stance from the neutral position it has maintained since announcing it early last year?