Government won’t get its wish

Rumours that members of the government are attempting to pressure the Reserve Bank of India (RBI) to loosen monetary policy are nothing new, although continued efforts to undermine the central bank’s independence are worrying. For its part, the RBI under the leadership of Governor Urjit Patel has previously defied the government, and we think this will remain the case. We expect interest rates to stay on hold both next week and well into next year.