Highlights of comments by MPC members at Aug 3-5 policy meeting

Following are the highlights of comments by members of the Reserve Bank of India's Monetary Policy Committee at their August 3-5 policy review.

Governor Sanjay Malhotra

* Chance of core-core converging to core inflation in Jan-Mar may suggest recalibration of policy rate

* Elevated headline inflation is primarily due to supply side shocks

* Evidence of food, fuel translating into broad-based inflation may need policy tightening

* Growth-inflation dynamics similar to last policy meeting

* Headline inflation mostly driven by higher food and fuel prices

* Indian economy is expected to remain resilient going ahead

* Inflation is inching up, it is expected to peak in quarter three

* Need to be watchful of food, fuel translating into broad-based increase in inflation

* No need monetary response as inflation expected to taper post Oct-Dec

* Risk of generalisation of inflation remains, but evidence so far is limited

* Would prefer to wait for more certainty on inflation trajectory for any recalibration of policy rate

Deputy Governor Poonam Gupta

* Case for rate hike may emerge during the year

* Global energy price outlook has improved

* Growth momentum remains supported by resilient activity

* Growth, inflation risks assessed as evenly balanced

* High-frequency indicators continue to show econ resilience

* Need clarity on supply inflation becoming entrenched

* Oil prices now expected to average around $90/bbl in FY27

* Rainfall, sowing and reservoir levels improved in recent weeks

* Scope for further monetary easing does not exist now

* Wait-and-watch approach best amid persistent uncertainty

Saugata Bhattacharya

* “On inflation I would exercise a word of caution.”

*  Apt to await evidence of a pickup in demand, generalisation of price pressures

*  High fuel prices MAY feed into second round inflation

*  Inaction can risk aggressive tightening later, but scant empirical evidence suggests pause better

*  India’s inflation and growth dynamics remain clouded

*  Must track the levels of real interest rates

Ram Singh

* Domestic demand remains resilient across key indicators

* FCNR (B) inflows to support rupee, limit imported inflation

* Full impact of higher energy costs will emerge gradually

* Global inflation pressures and market volatility persist

* High uncertainty still looms over several key policy indicators

* Incoming data crucial to assess second-round CPI impact

* Inflation-growth dynamics raise concerns at current juncture

* Limited pass-through of crude shock seen so far

* Monetary policy must keep inflation expectations anchored

* Need maximum flexibility amid evolving inflation risks

* No signs of economic overheating from core inflation

* Policy must adjust swiftly if external shocks worsen or price effects spread widely

* Private capex shows encouraging signs in April-June

* Survey shows input cost pressures are starting to enter headline CPI

* US rate action expectations remain uncertain

* Warrant close attention on both inflation and growth fronts

* West Asia conflict keeps crude prices under pressure

Nagesh Kumar

* Agriculture outlook remains clouded by the El Nino

* See no case for monetary policy action amid economic uncertainty

* Slight improvement in growth, inflation outlook should not cause complacency

* US tariffs, trade policy uncertainty pose concern for India exports

* West Asia conflict, trade policy, monsoon trends need close watch

Indranil Bhattacharyya

* Despite monsoon risks, food price rise moderate so far

* El Niño and oil price swings risk broader inflation

* High input cost spilling to services sector

* Pass-through of food, fuel price rises limited so far

* Policy pause preserves flexibility, does not necessarily imply extended pause

* Prefer to wait for inflation risks to materialise in prints before taking policy action

* Supply shocks threaten broader economic fallout

* Supply shocks threaten to trigger second-round impact across broader economic fallout

* Volatile two-way movements in global oil prices blurring near-term outlook