Mumbai: For the new Reserve Bank of India Governor Urjit Patel, the moment of truth is coming. Citigroup estimates that the correction in pulses and vegetables likely brought down the August CPI by about 90 basis points, according to a Sept. 6 report. “If the RBI refrains from cutting in October,” then it will likely cut rates in December by 50 basis points, they wrote. The yield on government notes due January 2026 dropped six basis points last week, the most in about a month. “If the rate cut is accompanied by a still dovish guidance that keeps market expectations for further easing alive, we can see” the 10-year yield dropping another 15 basis points, he said.

Source: Mint September 12, 2016 11:59 UTC