India Cash Inflows Prompt RBI Policy Tightening Concerns
Significant cash inflows into India, totaling $133 billion, are increasing the likelihood of the Reserve Bank of India adopting a more hawkish monetary policy stance. This follows recent efforts by the RBI to attract dollars to boost foreign exchange reserves and support the rupee.
Just months ago, the RBI used aggressive measures to attract dollars and shore up its foreign-exchange reserves and support the rupee. The stronger-than-expected wave of cash is now strengthening arguments for a more hawkish monetary policy stance. The record $133 billion inflow from the Indian diaspora…