With inflation figures expected to be well within RBI's target, there may be room for further rate cut.
Seeking to dispel possible notions of the RBI not having done enough by opting for a pause for the second consecutive time, Das said the RBI has a wide dashboard of instruments beyond rates that can be deployed.
It can be noted that the rupee lost nearly 7 per cent since the beginning of May as FIIs have pulled out nearly $4 billion from the domestic debt, as bond yields fell on expectation of RBI cutting rates on Monday.
'Course correction today would be good politics and also good economics,' notes T N Ninan.
A rate cut will bring positive sentiment around the Budget.
Forex dealers said apart from month-end demand for the American currency from importers, dollar's gains against other currencies overseas amid US data showing more-than-expected economic growth in the second quarter also put pressure on the local unit.
NITI Aayog vice chairperson Rajiv Kumar tells Indivjal Dhasmana that additional funds could be generated through divestment, and that the fiscal deficit should be widened while focusing on the revenue deficit.
A likely easing in inflationary pressures in the forthcoming months will reopen the window for the RBI to once again prioritise growth and ease its interest rates.
Markets shrugged off RBI's neutral stance on key policy rates.
The stronger than expected monsoon has not yet softened food inflation as much as it should have and in particular, vegetable prices have been impacted by weather-driven supply disruptions, said RBI Governor D Subbarao while unveiling the first quarter monetary policy review.
The surge in oil prices has also affected the rupee, which hit a 6-week low of 70.25 on Friday against the dollar.
In all, RBI has cut interest rates by 110 bps this year. But this has not yet led to a boost in economic activity. While the growth rate has slowed to a five-year low, consumer confidence is waning and foreign direct investment has plateaued.
'Rajan brought in a healthy air of competition in the banking sector.'
The use of Section 7 is fraught with risks to the autonomy of the central bank, the credibility of the government and the smooth functioning of the financial markets, says A K Bhattacharya.
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As many as nine respondents said RBI would hold the repo rate at 8% till March-end, 2015
The year 2014-15 could well go as one of long-pending financial sector reforms, expected to have a lasting impact.
There's only a slim chance of a substantial drop.
The rating agency expects the Reserve Bank of India to continue its accommodative monetary stance.
On speculative front as well, non-commercials have decreased bullish bets on COMEX silver futures and options to a three-month low.
A monsoon deficit is likely to affect the agriculture output, which could have an impact on the food inflation
Broader markets underperformed indices with BSE Midcap down 0.43% while the Smallcap index fell 0.07%.
Instead of a rate hike, or even a pause, there could be a window for the RBI for an interest rate cut
Being one of the early commentators to flag economic slowdown and caution investors on corporate earnings, Gautam Chhaochharia, head of India research, UBS Securities, in an interview with Hamsini Karthik says the markets remain in an expensive zone despite the recent correction.
India's numbers have shown a reasonable amount of improvement.
PMI went up from 51.2 points in May to 53.1 in June. Owing to the June figure, PMI for manufacturing stood at 51.9 points in the first quarter of 2018-19 against 51.8 points in the fourth quarter of 2017-18.
Experts caution against tough times in Indian equity markets in 2015.
RBI had previously cut repo rate by 0.25% each in January and March.
Dealers say foreign investors are now taking keen interest in lower-rated corporate bonds, too
As FY20 Budget fiscal measures need to be better understood, a reversal of the stance back to neutral will allow MPC flexibility to respond to incoming data.
'The Indian economy is in slowdown and growth may stay slow,' notes Devangshu Datta.
A career Citibanker, 'Selva' came into the spotlight as the person who rewired the financial behemoth's Indian retail operations.
'The variables to watch include the monsoon, resolution of NBFC liquidity issues, GST collections, and NPA resolution.'
Heading to the third year, will Urjit Patel be busy firefighting a currency crisis? Almost no governor of the RBI managed to evade it and Patel perhaps knows it.
Rajan said it was important that the government and the RBI be vigilant to the growth scenario.
If Mr Modi and his team expect to win the 2019 elections, groundwork for improved performance in their second term should be done now.
The HSBC India Manufacturing Purchasing Managers' Index, a measure of factory production, stood at 51.3 in April, unchanged from 51.3 in March, amid moderate expansion of incoming new business orders.
'The markets have corrected almost 8-9 per cent from their highs, so one can accumulate quality stocks at reasonable prices.'
Given the relative rates of gross domestic product growth, the differential will increase.
'Indian macro conditions have never been better, and many businesses will safely compound earnings over the next five years.'
'We have to be prepared on the borders to withstand Chinese expansionist designs.'
