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RBI May Cut Key Rates by 25bps

RBI May Cut Key Rates by 25bpsRBI May Cut Key Rates by 25bps

The Reserve Bank of India monetary policy committee is likely to consider a 25 bps rate cut on Wednesday, followed by another in the first quarter of 2017 amid downside risks to growth following the notes ban and subdued inflation, PTI reported. According to the global financial services major, DBS, the RBI policy committee is expected to take a ‘growth-supportive’ stance as the government’s recent banknote ban has raised downside risks to growth for at least two quarters, beginning the October-December quarter. Moreover, the subdued inflation is also expected to keep the door open for an easy policy bias. “These are likely to prod the MPC to consider a 25 bps rate cut on Wednesday, followed by another cut in 1Q17,” DBS said in the research note.

 

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