RBI Monetary Policy 2025 Live Updates: RBI Governor To Make Announcement Shortly; 25 Bps Rate Cut Expected

The index of industrial production showed a 0.4% expansion in October, compared with an expectation of 4%. While one argument can be that there were fewer working days in October owing to the festive season, there is a clear slowdown in manufacturing and negative growth in consumer durables. 

The other important data point to consider is goods and services tax collection for November, which rose just 0.7% year-on-year. At Rs 1.7 lakh crore, monthly GST collections were the lowest in a while. The next big data point to watch is credit growth. In the month of October, non-food bank credit growth was at 11%, largely led by lower credit growth in agriculture, despite a 100 bps rate cut this year. There is also a marked slowdown in UPI transactions in November, as the festive rush peters down. 

So growth is looking a bit uncertain right now. Even if the headline GDP growth number was 8.2% in Jul-Sep, the potential GDP growth in the economy might be 7% or lower, according to Radhika Rao of DBS Bank. To that effect, a rate cut might be warranted. 

Ahead of the RBI MPC meeting stock markets declined with Nifty near 26,000 and Sensex falling over 110 points.

Track live market updates here.

The yield on the 10-year bond opens flat at 6.50% before RBI rate decision.

Source: Bloomberg

Rupee opened 13 paise stronger at 89.85 against US Dollar

It closed at 89.98 a dollar on Thursday

Source: Bloomberg

Should India's rate setting panel cut rates further, as retail inflation is widely expected to turn negative in the coming few readings? Or should it hold its fire and watch for further evolving data, even as GDP clocked in a surprising 8.2% growth rate for the July-September quarter? 

There are too many expert voices advocating for both sides and they all seem very sure.

Click here to read what experts have to say