Expect RBI to hold rates on likely higher economic growth and inflation: Nomura

Sep 01, 2017 09:57 AM IST | Source: CNBC-TV18

Sonal Varma of Nomura said given the lower Q2 print, the research house is revising full-year forecast to 6.7 percent in 2017 versus 6.9 percent earlier, before it accelerates to 7.8 percent in 2018.

Sonal Varma of Nomura said given the lower Q2 print, the research house is revising full-year forecast to 6.7 percent in 2017 versus 6.9 percent earlier, before it accelerates to 7.8 percent in 2018.

Even as headline GDP data has disappointed, the turnaround in private services suggests that the growth cycle will head higher once the GST effects fade, she added.

From the RBI’s perspective, the GDP data is disappointing, but the current slowdown is largely due to GST, which should be seen as transitory, she feels.

According to her, focus remains on inflation, which is on an upward trajectory.

“Given our view that both growth and inflation are headed higher in the next 6-9 months, we expect the RBI to stay on hold,” Verma said.


Leave a Reply

Your email address will not be published. Required fields are marked *

4 × one =