Mark Mobius cautions RBI, says increasing rates now would be 'big mistake'

Most economists in a Bloomberg News survey expect the RBI to raise the report rate by 25 basis points on Aug 1

The Reserve Bank of India (RBI) will make a "big mistake" if it raises interest rates this week, according to veteran emerging markets investor Mark Mobius. 

His view goes against the crowd. Most economists in a Bloomberg News survey expect the Reserve Bank of India to raise the report rate by 25 basis points on August 1, a second hike in eight weeks. The six-member monetary policy committee headed by Governor Urjit Patel began its discussions on Monday.

Headline inflation is at the highest level in five months and above the 4 per cent midpoint of the central bank's target