With the 25bp repo rate cut to 6.5%, RBI finally relented to the growing demand from the government that saw the central bank’s intransigence responsible for causing India’s growth drag.
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Systematix Research Report
With the 25bp rate cut, Reserve Bank of India finally relented to the growing demand from quarters that saw the earlier 6.5% policy rate as “very stressful”. It also relays the newfound perception that easing regulatory tightness will resuscitate growth.
In our view, banking on counter-cyclical accommodation to address structural growth impediments will likely be ineffectual.
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