RBI MPC Quote: Insightful Take from Debopam Chaudhuri, Piramal Group

Here’s Debopam’s quote on the RBI MPC:

There was an opportunity to front end the rate cuts with a 50 bps decline in April’25 since currency has strengthened, inflation fallen below target and US and Indian yield differential rising once again. However, the change in stance and sharp rise in surplus systemic liquidity will do for now. With an accommodative stance, markets now are certain than the only way forward for rates is downwards. Transmission will also improve supported by the liquidity and the fact that share of EBLR loans have now increased to more than 60%, prompting faster pass through of repo declines to end user loan rates.

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