To me the rate should remain same.
- Inflation is inching up(5.39% in April, the latest figure). This push the real rate at 1.1% for 6.5%. This warrants wait.
- According to the latest number the growth(though people can have issue with calculations) is robust. At 7.9%, India is fastest growing major economy. So better watch out rather then risk heating up.
- Oil Prices are also inching up, from the lows of $30 it is going to $50. So the risk of upside is higher now.
- From the present reviews, the liquidity is already there. Lowering the rate should rather be delayed.
- The latest data from US is not very encouraging in terms of job. So there is a good chance that FOMC will not be very inspired to raise the rate on 16 June.
- Only MET dept news on above normal is encouraging, apart from that this blog believe that status quo should be mentained.