The industry and the banks may not be wanting any further hike on interest rates but to me it seems another one is in the offing on October 25 when the Reserve Bank of India will make a policy announcements. The main reason for this is the stubbornly high inflation. It seems economists have advised RBI to keep tightening the screws. This will surely men crackers exploding a day before Diwali and take some light out of the "Festival of Lights" the next day. Having said that I would expect this trend of rising rates to continue for some more months at the most. At a certain point, every cycle turns and this one seems fairly near that point. The RBI at a juncture in the near future, will start getting the evidence it wants and that is likely to happen through lower demand. Supply side issues such as infrastructural bottlenecks, which need the help of the government--which is near-absent at the moment--don't get sorted out so soon as they need policy changes, investments and so on.
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