Morgan Stanely's Chetan Ahya sees RBI MPC going for a 25 basis points hike tomorrow. However, he underlined that the RBI is unlikely to give a clear signal that this is the last rate hike.
"I think there is still a lot of uncertainty around inflation outlook as well as what happens to the Fed policy."
He said that India is estimated to grow at 6.2 per cent as slowdown in global demand will take a toll on domestic growth.
He also flagged that a deeper slowdown in US could hit India's growth prospects.
"If there's a deeper slow down in US because of this tightening of lending standards, you could shave off some more of India's growth."
Despite the global headwinds, he remains confident of the India story stating that the strong domestic demand is a key pillar of India growth story.
On Tuesday, the World Bank and the ADB slashed their growth forecasts for India for FY24 due to global macroeconomic challenges.
World Bank expects India to grow at 6.3 percent while ADB projects growth at 6.4 percent.
RBI Governor Shaktikanta Das will announce the key monetary policy decision tomorrow. It is widely expected that the MPC will hike the repo rate by 25 basis points before hitting the pause button.
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