Inflation seen at 5% in March; RBI may cut rates by 25 bps
India’s retail inflation for March is expected to be around 5% and the Reserve Bank is likely to cut its key rate by 25 basis points each at its policy reviews on April 5 as well as in August, says a report. According to Bank of America Merrill Lynch (BofA-ML), its inflation indicator is tracking March CPI inflation at 5%, slightly lower than February’s 5.2% . “We continue to expect the RBI to cut rates 25 bps on April 5 and in August,” BofA-ML said in a research note. The declining inflation and negative industrial outlook have strengthened the case for RBI cutting interest rate in its first bi-monthly monetary policy for 2016-17 on April 5.