Call grows among market participants for shift in RBI's stance to neutral

Drop in bond yields reflects hope of smaller hikes

Ahead of the Monetary Policy Committee’s (MPC’s) statement on Friday, while market participants are certain about a rate hike, there are also growing calls for a shift in the central bank’s stance.

Economists and market watchers are divided on whether the Reserve Bank of India (RBI) will announce a change in the stance of monetary policy. According to a BS poll, the MPC is expected to raise the repo rate by 35-50 bps from the current level of 4.9 per cent. This will take the policy rate past 5.15 per cent. It was 5.15 per cent before the RBI started