The end of independence for the RBI?

Macro 4 minutes to read

Kay Van-Petersen

Global Macro Strategist

Summary:  What does a less-independent RBI mean for the rupee?


The resignation of Reserve Bank of India governor Urjit Patel, who left citing 'personal reasons' following repeated pressure from the Modi government, has many onlookers concerned about the RBI's independence.

According to Bloomberg, "with state elections in progress and federal elections due next year, Modi’s officials have been pressing the RBI to lighten up. They want the central bank to transfer some of its reserves to the government, to relieve pressure on the public finances. They have called for gentler treatment of bad loans and for other kinds of regulatory forbearance. And they’ve made it clear that they’d prefer a less hawkish approach to monetary policy."

These developments place the future of the INR in jeopardy; click here for Saxo Head of APAC Macro Strategy Kay Van-Petersen's latest thoughts on the INR charts under what appears to be a retreat of central bank independence in India.

Click here to watch Van Petersen's analysis of the situation on YouTube.

Saxo Bank A/S - Representative Office
Boulevard Plaza - Tower 1
30th floor, office 3002
Dubai Downtown, Burj Khalifa area
Dubai
UAE

UAE

Trade responsibly
All trading carries risk. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

Saxo Bank A/S is licensed by the Danish Financial Supervisory Authority and operates in the UAE under a representative office license issued by the Central bank of the UAE.

The content and material made available on this website and the linked sites are provided by Saxo Bank A/S. It is the sole responsibility of the recipient to ascertain the terms of and comply with any local laws or regulation to which they are subject.

The UAE Representative Office of Saxo Bank A/S markets the Saxo Bank A/S trading platform and the products offered by Saxo Bank A/S.