RBI can cut the repo rate by 25 basis points, MPC meeting will start tomorrow – ryan
The 54th meeting of MPC, which determines the repo rate, will begin on April 7. There are speculations that RBI may cut the repo rate by 25 basis points this week. In February this year, the RBI Monetary Policy Committee (MPC) headed by Governor Sanjay Malhotra reduced the repo rate to 6.25 percent.
PTI, Mumbai. The RBI may cut the repo rate by 25 basis points this week. The US -declared mutual fees are becoming a challenge for the global economy, so experts believe that the central bank can take this step to encourage development.
In February this year, the RBI Monetary Policy Committee (MPC) headed by Governor Sanjay Malhotra reduced the repo rate to 6.25 percent. This was the first cut in the repo rate after May 2020 and the first amendment in the main interest rate after two and a half years.
54th meeting of MPC will start on April 7
The 54th meeting of MPC determining the repo rate will begin on April 7 and the verdict will be declared on April 9. The RBI had kept the repo rate (short -term lending rate) unchanged from February 2023 at 6.5 percent. The last time the RBI had reduced the rate (May 2020) at the time of Corona and then gradually increased to 6.5 percent.
Chief economist Madan Sabnavis of Bank of Baroda said that the loan policy declared this week will come at a time when many things are happening all over the world and within the economy. He said that the tariff imposed by the US will have some impact on the development possibilities and currency of the new era and the MPC will have to consider it.
It seems that the time is perfectly suitable for deducting 25 basis points in the repo rate on it, with the softening of inflation and almost the cash crisis.
Rate cuts with neutral trend expected: Ikra
US President Donald Trump has announced a mutual tariff of 11-49 percent on about 60 countries including India and China on April 2. This will be applicable from April 9. According to experts, there are both challenges and opportunities for India, as exports have high fees on many of its competitive countries, such as China, Vietnam, Bangladesh, Cambodia and Thailand. The rating agency Ikra also hopes that the MPC will cut the rates by 25 basis points in its upcoming meeting.
RBI adopts monitoring stance instead of cuts cut
Assocham Industry Organization Assocham suggested that the upcoming monetary policy should adopt waiting and monitoring instead of cutting the rate at this stage. President Sanjay Nair said that RBI has recently put cash in the market through various measures. We should be patient to see the impact on capital expenditure increase and consumption of these measures. In such a situation, I hope to keep the rates stable. He said that despite the challenges on the external front, the Indian economy is likely to be in a strong position in the new financial year. FY 26 is expected to increase GDP of about 6.7 percent while retail inflation is likely to remain under control. In February, retail inflation came to a seven -month low to 3.61 percent.
Demand will increase in housing market due to rate cuts
- Pradeep Aggarwal, founder and chairman of Signature Global Signature Global (India) Limited, said that RBI can bring it to six percent by cutting the repo rate by cutting 25 basis points to promote consumption and speed up economic development.
- He said that the policy rate decrease plays the role of a catalyst in borrowing, which encourages more people to invest to buy a house, increasing demand in the housing market.
- However, the actual impact of this rate cut will largely depend on how effective and rapidly to the commercial bank RBAD’s policy decisions.
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