It is too early to say what the RBI would do, but there are 3 options. Firstly, rate hikes are being discussed at this point of time, but that looks unlikely as early as December. Secondly, the RBI could raise reverse repo rates, which is almost 65 bps lower than the repo rates. The third possibility is that RBI, in line with the Fed stance, may look to change the stance of the monetary policy from accommodative to neutral
Regarding the repo rate hike, it looks too premature and that will wait for now. Regarding reverse repo rates being hiked, banks like SBI have asked the RBI to wait for now due to the Omicron virus threat. Lastly, accommodative stance shift is possible, but the RBI may prefer to work through liquidity suction through variable rate repos rather than through changing the stance. Most likely, this like a status quo policy, but the language will be important.
It is too early to say what the RBI would do, but there are 3 options. Firstly, rate hikes are being discussed at this point of time, but that looks unlikely as early as December. Secondly, the RBI could raise reverse repo rates, which is almost 65 bps lower than the repo rates. The third possibility is that RBI, in line with the Fed stance, may look to change the stance of the monetary policy from accommodative to neutral
Regarding the repo rate hike, it looks too premature and that will wait for now. Regarding reverse repo rates being hiked, banks like SBI have asked the RBI to wait for now due to the Omicron virus threat. Lastly, accommodative stance shift is possible, but the RBI may prefer to work through liquidity suction through variable rate repos rather than through changing the stance. Most likely, this like a status quo policy, but the language will be important.