Forex Flash: India WPI report allows a RBI rate cut by 25-50bps - Commerzbank

FXstreet.com (Barcelona) - Softer than expected WPI (Wholesale Price Index) report for June in India brought a collective sigh of relief as it gave more room for monetary policy from the RBI. Data dropped from 7.5% to 7.2% (YoY) (food unchanged at 10.8%, fuel eased to 10.3%, manufacturing still at 5%) and core data is estimated to remain steady at 4.9%. "Even though WPI is still above RBI's comfort zone of 6-7%, we see RBI cutting rates by another 25-50bp to 7.50-7.75% on 31 July given downside risks to global growth", wrote Commerzbank analyst Charlie Lay.