RBI Watch: Inflation jump to keep MPC on the sidelines

The hotter-than-expected consumer price inflation data over the past couple of months will be enough to convince a majority of MPC members that conditions are not yet right to begin easing policy. As such, we think the repo rate will remain on hold at 6.50% at the conclusion of the MPC meeting on Friday 6th December. As it stands, RBI Governor Shaktikanta Das is due to step down after that meeting, but it appears highly likely that his term will be extended. That means he would be at the helm to oversee the eventual start of the easing cycle in April.