Bond dealers, economists expect RBI to lower policy rate at June 6 meeting

SBI expects RBI to cut rate by as much as 50 bps at June 6 meet

Bond dealers and economists are certain that the Reserve Bank of India (RBI) will lower the policy rate. However, there is disagreement on the timing.

The rate can be pared right now to give growth a push, but is possible that the six-member Monetary Policy Committee (MPC) prefers to pause till the Union Budget in July. By then, those who prefer a pause in the June 6 policy say monsoon-related uncertainties would be clear, too. 

The policy repo rate is now at 6 per cent. Retail inflation was at 2.92 per cent in April, but the market expects gross domestic product (GDP)