Ruling out any rate cuts soon, SBI house economists said headline inflation is set to scale past 5.4 percent in the next few months, rendering a rate cut in February or even in April as a difficult proposition.
Analysts at Japanese brokerage Nomura also see RBI leaving the rates unchanged in February due to inflation worries, but it may act if the growth falls further.
However, all these analysts agree that a rate cut is on the table but are not the same page on the timing though. Analysts at Axis Mutual Fund said while the pause was a surprise, intentions of the RBI are "prudent" due to the weak macroeconomic conditions.
Bank of Baroda's chief economist Sameer Narang said the rate cut cycle will have to wait for inflation to be within the target range.
Meanwhile, economists at domestic brokerage Motilal Oswal said the pause increases the credibility of RBI's inflation mandate and there will be no rate cuts for at least one year or till inflation comes down to under 4 percent.
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