Soumya Kanti Ghosh, the chief economic advisor for SBI group, advised the RBI to "pause and think" about whether it can continue to raise interest rates "stroke by stroke" in sync with the US Federal Reserve or if it should detach itself from the US institution. According to Ghosh, the Fed's cycle of rate hikes will not cease in the near future, which supports the idea for RBI's consideration of decoupling.
"My point is can we match the Fed stroke by stroke? At some point of time, we need to pause and think whether the impact of the earlier rate hikes (by the RBI) has percolated down into the system... I don't see any end to the Fed's cycle soon, it could be three or more rate hikes going ahead," Ghosh said.
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