Markets see MPC hiking rates by at least 50 basis points in coming months

Typically, an interest rate defence of currency is meant to protect the real interest rate differential between countries

Going by the three-month overnight index swaps, the markets seem to be expecting the monetary policy committee (MPC) to raise the benchmark rate by at least 50 basis points in the coming month.

With the growing clamour for the Reserve Bank of India to intervene and arrest the rupee's decline, will the MPC tighten monetary policy? If it does, will it do so to curb inflation due to the rupee's depreciation or will it be interpreted as a defence of the rupee? And, if status quo is maintained, what would be the other options before the RBI?

Typically, an interest