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Wednesday, February 4, 2009

RBI may cut rates after interim budget: PM adviser

The Reserve Bank of India (RBI) may cut interest rates after February's interim budget is approved and it has a better sense of the country's fiscal situation, a top policy adviser said on Wednesday.

"Possibly they will wait for the vote-on-account or interim budget to gauge the fiscal situation," Chairman of the Prime Minister's Economic Advisory Council Suresh Tendulkar told Reuters in a telephone interview.

"In the light of that, they may decide to cut rates."

He said the cost of credit needs to fall to boost confidence.

"They (rates) should be cut to reduce the cost of credit and that should help confidence. In my view cutting rates is desirable."

Tendulkar, a noted economist, heads the council, which only has advisory powers and is not involved in policy making.

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Economic Event Calendar

GMT+5:30 Event Vol. Actual Consensus Previous
Thursday, Jun 12
18:00 Producer Price Index ex Food & Energy (MoM) 2 0.1% 0.3% -0.2% Revised from -0.4%
20:00 EIA Natural Gas Storage Change 1 109B 108B 122B
21:00 4-Week Bill Auction 1 4.08% 4.17%
21:30 USDA WASDE Report 1
22:30 30-Year Bond Auction 1 4.844% 4.819%
Friday, Jun 13
04:00 Business NZ PMI 2 53.9
14:00 Consumer Inflation Expectations 2 3.4%
18:00 Manufacturing Sales (MoM) 1 -2.0% -1.4%
18:00 Capacity Utilization 1 79.8% 79.8%
18:00 Wholesale Sales (MoM) 1 -0.9% 0.2%
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