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2026-05-21 15:25:09
Standard Chartered Bank expects India to raise interest rates in June, bringing the total to 5.75% this fiscal year. ⑴ Standard Chartered Bank expects India to raise its benchmark interest rate in June to support the rupee exchange rate and curb the secondary effects of inflation. Economists Anubti Sahai and Suraf Anand adjusted their reverse repo rate forecast in a research report, abandoning their previous prediction of keeping rates unchanged, and now expect a total of 50 basis points of rate hikes this fiscal year, bringing the rate to 5.75%. ⑵ This adjustment stems from institutions raising their inflation forecasts for this fiscal year, while the pressure on the Indian rupee to depreciate continues to increase. The 50 basis point rate hike will be evenly distributed across June and August; if the rate hike is postponed in June, then a one-time 50 basis point hike will occur in August. ⑶ If commodity prices remain under pressure and the rupee weakens, leading to higher-than-expected inflation, there is a risk of an additional 25 to 50 basis point rate hike in fiscal year 2027.
