‘MPC likely to cut rates if external headwinds remain.’ says ICICI report

If external headwinds persist and domestic growth begins to decelerate, the Monetary Policy Committee (MPC) is likely to consider cutting policy rates in its December meeting, according to a report by ICICI Bank .

The report highlighted that the odds of further monetary easing have increased following a noticeable shift in the MPC’s policy language.

In the August policy, the committee had noted that “monetary policy has used policy space created by benign inflation outlook.” However, in the October review, this language shifted to “sobering of inflation has given greater leeway for monetary policy to support growth,” which, according to ICICI Bank, marks a dovish tilt.

MPC is likely to cut rates

It stated “The most important determinant factor deciding the trajectory of rate cuts i