Economists and Traders Disagree on India Rates
- Six of 12 economists surveyed say Patel would wait and watch
- Indian bonds rally on expectation of more repo rate cuts
Urjit Patel, governor of the Reserve Bank of India arrives at a news conference in Mumbai, on Oct. 4, 2016.
Photographer: Dhiraj Singh/BloombergThis article is for subscribers only.
While traders are betting that India’s surprise cash clampdown will open room for Governor Urjit Patel to cut interest rates again, economists are more circumspect.
A Bloomberg survey of 12 economists is split through the middle on whether India’s move to invalidate more than three-quarters currency in circulation will dent demand, lowering both inflation and growth. Disappointing economic data could push the central bank to reduce the benchmark rate as early as next month, some said; others maintained that Patel would wait for more evidence of a slowdown.