Thread by @NDTVProfitIndia

Is India’s current high inflation transitory or structural?
What can we expect going forward?
And what policy course should the Monetary Policy Committee set?

Read @Rabobank’s Hugo Erken in #BQOpinion.
bit.ly/33VMSTv

@Rabobank Partly, this was due to unfavourable base effects related to waning food inflation in H2 2018, writes Hugo Erken in #BQOpinion.
bit.ly/303HRXN

@Rabobank But, core inflation rose as well.

Sectors that have been hit hardest by Covid-19 like transportation and hotels have begun pushing up prices, points out Hugo Erken in #BQOpinion.
bit.ly/3ctXigY

@Rabobank A combination of factors will cause inflationary pressure to start to build again by the beginning of 2021, peaking in Q2 to 7.4%, writes @Rabobank’s Hugo Erken in #BQOpinion.
bit.ly/2G7c3KE

@Rabobank Given the explicit inflation mandate of the RBI, and the importance of the central bank’s credibility, the MPC will likely remain reluctant to cut its policy rates in October, writes Hugo Erken in #BQOpinion.

Read more: bit.ly/33ZDqib

@Rabobank The current stagflation situation in India must surely be giving RBI Governor Shaktikanta Das and his fellow members of the MPC a headache, writes @Rabobank’s Hugo Erken.

Read more in #BQOpinion: bit.ly/3cx7LbC

@Rabobank Against the backdrop of deteriorating fiscal metrics, the central bank will probably have to do the heavy lifting, writes @Rabobank’s Hugo Erken.

Read his #BQOpinion column.
bit.ly/305hNMb

@Rabobank India’s inflation woes are not just problematic in the short to medium-term but could pose an even bigger problem in the longer-term. Inflation could exceed 8% in 2023, cautions Hugo Erken in #BQOpinion.
bit.ly/3cx7LbC

@Rabobank Down the road, RBI should act quickly to prevent becoming caught up in a potential global inflationary spiral, writes Hugo Erken.

Read his #BQOpinion column: bit.ly/3cx7LbC