Das Needs Monsoon Rains to Deliver Before Weighing Rate Cuts
- Uneven monsoon could affect India crops, drive up inflation
- Weather-related risks featured prominently in RBI’s decision
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As Reserve Bank of India Governor Shaktikanta Das made the case for inflation risks arising from a delayed monsoon after holding interest rates again, the weather office declared the rains had finally reached the South Asian nation.
The weather announcement on Thursday provided some relief to the rate-setters and millions of farmers across India, but the concerns are not quite over. If there’s an uneven spread of the monsoon rains, Indian economy watchers say it may mean a longer wait for Das and his policy makers to cut rates and change the RBI’s tightening stance to neutral.