Global forecasting firm Oxford Economics on Sunday, reported, that the Indian economy has been recovering faster than expected and the Reserve Bank of India is likely to end the rate easing cycle soon.
It further added that inflation is expected to be average, significantly above 6 percent in the Q4 of the current fiscal.
The RBI may hold policy rates in December monetary policy review meeting, it further reported.
Oxford Economics stated “Consumer inflation rose back to pre-virus highs in October, with almost every broad category other than fuel experiencing a rise in prices. While Q4 is likely to mark the peak for inflation, we have turned more cautious on the trajectory over 2021.”
Retail inflation stood at 7.27 percent in September 2020.
Costlier vegetables and eggs pushed up retail inflation to a nearly six-and-a-half-year high of 7.61 percent in October, keeping it significantly above the comfort zone of the Reserve Bank.
‘At the same time, robust bottom-up activity data suggest that the economy may be recovering faster than we anticipated. As such, we see an increasing possibility that the RBI’s easing cycle has ended,’ Oxford Economics said.
RBI on 11 November, reported, “Indian economy has entered a technical recession.”
