Like Indonesia, India's central bank may hike rates to defend its currency

People walk past Reserve Bank of India signage in front of an installation stall at Global Fintech Fest in Mumbai, India, on Aug. 28, 2024. Indranil Aditya | Nurphoto | Getty Images India's central bank may defy expectations that it will leave its benchmark interest rate unchanged during its monetary policy decision meeting on Friday. The majority of economists polled by CNBC expect the Reserve Bank of India to keep rates unchanged at 5.25% while signaling a rate hike may only occur towards the end of the year. A minority expect policymakers to act at this week's meeting in a bid to anchor the rupee, which has depreciated to record lows against the dollar. CNBC conducted a poll of nine economists over the past week, in the run-up to the RBI policy decision. But it is "more logical," for India's central bank to chart a different course and raise interest rates, said Venugopal Garre, managing director and head of India research at Bernstein, speaking on CNBC's Inside India on Tuesday. A rate hike will align India with "how global rates have moved in the more recent weeks," and could contain outflows at a time when "currency depreciation has been the biggest pain point for policy makers," he added. India's regional peers have acted — some going beyond expectations — to get ahead of the inflation curve. …