Economists at Commerzbank discuss the Reserve Bank of India (RBI) policy and USD/INR outlook.

RBI is in a wait-and-see mode

“RBI is in a wait-and-see mode. They left rates unchanged at 6.50% in April. They are likely to stay neutral-to-hawkish near term and rule out a rate cut anytime soon. They would need to be convinced of a notable moderation in core inflation in order to consider rate cuts.”

“For USD/INR, it has held within the 81-83 range so far this year and holding just below the 82 level. It appears RBI is content to see a relatively stable INR for now.”