India's overnight indexed swap (OIS) rates jumped after the Reserve Bank of India stressed bringing inflation down to its 4% target, which could push the possibility of any interest rate cuts to next year and not before, at least three analysts said.

"The OIS market had factored in a rate cut for December, and for sure these expectations have been pushed back by a quarter," said Vijay Sharma, senior executive vice president at PNB Gilts.

"Though the market is expecting a thin chance of rate cut in February 2024, my own view is that... the cut will be delivered only in April," he said.

India's one-year OIS rate rate jumped eight basis points to 6.64%, the highest since April 6, while the five-year swap rate jumped 13 basis points to 6.15%, the highest since April 19.

Traders said they are not only expecting a delay in the timeline for the next rate cut, but are also betting the subsequent cut would now come in the middle of 2024, from previously expecting the second rate cut to be delivered in the early part of next year.

The possibility of a rate cut "has shifted from December to February, while the second rate cut could take place only between June and August 2024," said Abhishek Upadhyay, senior economist at ICICI Securities Primary Dealership.

Earlier in the day, the RBI kept repo rate and policy stance unchanged as widely expected, but signalled that monetary conditions will remain tight for some time as it looks to further curb inflationary pressures.

Governor Shaktikanta Das said the central bank needed to move towards the primary target of inflation at 4%, and it will do "whatever is necessary to ensure that long-term inflation expectations remain firmly anchored."

The RBI expects inflation to average 5.1% in this financial year, while it sees growth at 6.5%.

Barclays said it did not believe a policy pivot, where the RBI would start signalling cuts, would come anytime soon.

"As such, we see the RBI remaining on hold through FY2023-24, only seeing a window for rate cuts opening in April-June," chief economist Rahul Bajoria said.

(Reporting by Dharamraj Dhutia; Editing by Nivedita Bhattacharjee)