Posted 1/28/2024, 3:39:58 AM
Rupee Stable But High Inflation Leaves Little Room for Rate Cuts Before Elections
- Rupee unlikely to see major depreciation for rest of fiscal year due to high inflation leaving no room for decline
- Exchange rate looks stable with rupee below Rs280 per USD, though some predict could end at Rs310
- Relentless inflation now covers entire economy so all policies aimed at normalizing it
- General elections have added uncertainty to economic scenario; new government unlikely to make big changes unless inflation cools significantly
- High cost of production has created pressure to cut interest rates but high inflation closes door for rate cut in next monetary policy