Time is ripe for second interest rate hike as inflation risks mount

Whether the debt selloff will continue or not depends on the message from the six-member MPC headed by Governor Urjit Patel

India's central bank is on course to raise interest rates for a second consecutive policy meeting as it takes more decisive steps to rein in inflation and stem capital outflows.

With inflation running well above the central bank’s medium-term target of 4 per cent -- and the outlook set to worsen as oil prices stay elevated and the currency slides -- pressure is building on the Reserve Bank of India to act. Bond investors are already taking shelter in shorter-term debt amid concern this could be the start of a tightening cycle.

"It's a great time for the RBI to hike rates