RBI Likely to Hold Rates as Growth Stays Solid, Commerzbank Says

India’s economic momentum continues to surprise to the upside, as June industrial production data came in stronger than anticipated. Meanwhile, inflation remains comfortably within the Reserve Bank of India’s (RBI) target range, providing no urgency for a rate change.

Commerzbank analysts note that these developments support the view that the RBI will keep its policy rate on hold. The central bank has already paused its tightening cycle, and with growth solid and price pressures contained, there is no need for further hikes.

The Indian rupee has benefited from the favorable data, with USD/INR easing in recent trading. A stable rate outlook and improving growth sentiment are providing tailwinds for the currency.