India's Inflation Sets Scene for October Rate Hike
Dow Jones
45 mins ago
1056 GMT - India's elevated August inflation data sets the scene for a rate hike in October, Shilan Shah of Capital Economics writes in a note. Further rises in inflation are expected, and the renewed surge in oil prices imply that the "risks are heavily stacked to the upside," Shah said. Fuel-price inflation held steady last month, but the renewed elevated energy prices due to the Middle East conflict leaves open the prospect of further pump price hikes, Shah adds. Excess banking liquidity and rising household inflation expectations also support the expectation that underlying inflation will rise over the coming months, Shah adds. CE expects a total of 75bps of hikes to the repo rate this cycle, taking it to 6.00% in the first half of 2027.
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