RBI’s Mid-Quarter Monetary Policy Review: June 2012

Here is an analysis of RBI’s mid-quarter review of monetary policy held today.  RBI statement is here.

Overall, very interesting to see the RBI surprise to keep rates unchanged. Most expected 25 bps in Repo and  50 bps in CRR. RBI gave a big thumbs down refocusing on inflation. I just hope the focus remains on inflation till it finally comes down. Our policymakers rejoice a bit too quickly seeing  inflation decline in a few months. It is amazing how quickly inflation concerns resurface each time we think it is headed down.

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