Raghuram Rajan, a former chief economist at the International Monetary Fund, took charge at the Reserve Bank of India as the country faces its worst economic crunch since a balance of payments crisis two decades ago.
Traders have cited hopes Rajan may take a fresh approach to the RBI's risky strategy to raise short-term interest rates and drain cash under outgoing governor Duvvuri Subbarao.
"The hope that the central bank will roll back the cash tightening measures has always been there.
“It may take some time but probably should happen before September-end," said Bekxy Kuriakose, head of fixed income at Principal PNB Asset Management.
Traders largely expect the status quo to remain at least until the US Federal Reserve's monetary policy meeting on September 19
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