The Reserve Bank of India begins its three-day policy meeting today, drawing market attention.
Economists expect the central bank to keep the repo rate unchanged at 5.50%.
However, the tone of the policy statement will be closely watched for future
guidance.
Inflation has cooled to 4.7% in August, giving RBI some room to stay accommodative.
Growth numbers remain mixed, with services strong but manufacturing facing weakness
.
Bond markets have stayed flat as traders prefer to wait for RBI’s clarity.
Banking and financial stocks may see volatility depending on RBI’s comment
ary.
Foreign portfolio flows have slowed, adding further caution to the market mood
.
Analysts believe a status quo policy is the most likely outcome.
Investors are preparing for RBI’s decision to set the tone for October trading.