The Reserve Bank of India’s (RBI’s) decision to maintain the status quo has taken the market by complete surprise. The markets do not like unexpected news and to that extent yields have jumped. However, markets must interpret it as a temporary pause just akin to biological osmosis.
In a similar vein, the current pause with an accommodative stance could just be an attempt to allow the impact of surplus liquidity and transmission to permeate through the system. But in the same vein, given that inflation will stay elevated in the next couple of months at close to at least 5.3-5.4 per
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