Srinagar, Feb. 22 -- Chennai, Feb 22 () Credit rating agency Acuite Ratings and Research said the Reserve Bank of India (RBI) will continue with monetary tightening and will hike the policy rate by 25 basis points (bps).

In a report, Acuite Ratings expects the RBI to persist with monetary tightening to guard against generalisation of core inflation pressures into a wage-price spiral.

"After a hike of 25 bps in Apr-23, MPC (Monetary Policy Committee) could opt for a pause for impact assessment. The stance may change to 'neutral' only after core inflation witnesses a sustained decline to below 5 per cent," Acuite Ratings said.

According to the report, over the last three months, inflation has begun to descend from peak levels across most...