RBI expected to hold rates on Aug 5

RBI is expected to leave interest rates unchanged at its monetary policy committee meeting on August 5, according to economists.

High frequency indicators including industrial output and GST collections point to resilient domestic activity, reducing urgency for a rate cut.

Volatility in West Asia and its effect on crude oil prices are the chief risks, while El Nino concerns have receded.

SBI chief economist Soumya Kanti Ghosh expects CPI inflation to average around 5% in FY27, with Q1 real GDP growth at around 7.0%.

Goldman Sachs economists expect the rupee to stabilise following RBI measures to attract foreign capital, and see limited need for the MPC to turn more hawkish.