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RBI's next Monetary Policy Committee meeting on October 1st; decision on repo rate cut or stability possible
RBI: An important decision regarding the repo rate could be made at the RBI's monetary policy meeting on October 1st. An SBI report has suggested a 25 basis point cut, although most experts expect rates to remain unchanged.
In the face of constant deliberations on the repo rate, the Reserve Bank of India's (RBI) Monetary Policy Committee (MPC) will next convene on October 1st. It is thought that the decision of some importance over the repo rate would be taken at this meeting. In this instance, an SBI report has postulated a 25 basis point (bps) reduction, although some specialists are of the opinion that the RBI would hold on to its existing rate.
During February to August of this year, the RBI reduced rates three times by a total of 100 basis points since inflation is softening. In August, the RBI again left the rate unchanged and pursued a policy of tracking the effects of US tariffs and global tensions.
The SBI report states that retail inflation is expected to remain low next fiscal year as well, so a 25 bps rate cut would be the right move. Meanwhile, Bank of Baroda Chief Economist Madan Sabnavis said that a rate change is unlikely at this time, and a cut could only occur if the government announces a package for exporters.
