Prospects Of Deep Rate Cuts Are Low In India: Credit Suisse

Though the Reserve Bank of India left key rates unchanged in its recent monetary policy review, the prospects of deep cuts remain low after the 50 bp of front-loaded cuts last quarter, believe analysts at Credit Suisse.

Ashish Agrawal and Martin Yu of Credit Suisse, in their April 8 research note titled “Asia rates: India – reality check for a few,” point out that the weakness in bonds is temporary.

India: Aggressive expectations of a minority

The Credit Suisse analysts note that India’s central bank, the Reserve Bank of India, left key rates unchanged at its first bimonthly monetary policy review for FY 16. The analysts point out that the RBI’s stance remains accommodative, while its guidance was dovish.

The analysts note that...