- The key is to ensure policy normalisation does not lead to unwarranted market fragmentation
- Given uncertainties, rates will have to be raised gradually
- Monetary policy cannot counter increase in commodity prices
It is clear that Visco acknowledges that the central bank has to move considering its mandate but he is definitely not shying away from standing apart from the hawks. It is tough to see a 50 bps rate hike in July so long as there remains these kinds of reservations.
