RBI Minutes Signal More Inflation Vigilance, but Rate Panel Warns Against Moving Too Fast
Key points The Reserve Bank of India's Monetary Policy Committee raised the repo rate to 5.50% earlier in October. Minutes released on October 21 show members concerned that inflation could spread beyond its initial drivers. Members differed on the need for further increases and the risks to growth. The Reserve Bank of India's latest policy minutes have made one point clear: the October rate increase was not necessarily the end of its response to inflation. They have not, however, set a timetable for the next move. Members of the Monetary Policy Committee described stronger price pressures while weighing the cost of more expensive credit for households and businesses. The committee unanimously raised the repo rate by 25 basis points to 5.50% at its earlier October meeting, its first increase in nearly four years. It also changed its policy stance from neutral to calibrated tightening. The minutes, released on October 21, explain the thinking behind the decision rather th...