Indian markets will remain closed on Tuesday on account of a local holiday. "We are expecting a rate hike this week. The central bank may not explicitly say anything but will become data dependent and look at the global environment first and then the domestic environment," said Aneesh Srivastava, chief investment officer of Star Health and Allied Insurance. Oil prices jumped on Monday after the Organization of the Petroleum Exporting Countries and allies, including Russia, known as OPEC+, said there would an additional cut of about 1.16 million bpd.
This brought the total volume of cuts by OPEC+ to 3.66 million bpd, according to Reuters calculations, equal to 3.7% of global demand. The benchmark Brent crude futures rose to four-week high levels, last trading 6.2% higher at $84.70 per barrel. Elevated oil prices could impact the inflation trajectory of India, one of the largest importers of the commodity. India's retail inflation stayed above the central bank's upper tolerance range for the most of the last financial year forcing the Reserve Bank of India to hike rates by 250 bps to 6.50%. The RBI will raise the interest rate by 25 bps on Thursday and then pause for the rest of the year, according to a Reuters poll of economists.
Traders also awaited the start of the weekly auction as the government aimed to raise 8.88 trillion rupees ($107.81 billion) via bonds in April-September, which could steepen the yield curve. ($1 = 82.3680 Indian rupees) (Reporting by Dharamraj Dhutia; Editing by Sohini Goswami)
