MUMBAI, Sept. 29 -- Nomura expects the Reserve Bank of India's Monetary Policy Committee to deliver only two 25-basis-point rate hikes in the current cycle, taking a markedly different view from market pricing that points to as much as 125 bps of tightening.

The Japanese financial services group expects the MPC to increase rates in October and December and then pause the hikes, anticipating a moderation in inflation pressures, its economic research team said in a media briefing on Tuesday. The RBI's next monetary policy decision is due on 7 October.

"The urgency of rate hikes is actually lesser than what the market believes at this point," Nomura economist Aurodeep Nandi said, adding that underlying inflation remains relatively containe...