The policy decision will be announced at 11:45 a.m. in Mumbai, followed by a press conference 15 minutes later by Das
The Reserve Bank of India is set to deliver a fifth straight interest rate cut Friday, although economists are unsure of the quantum following an unconventional 35 basis-point easing last time.
While all 39 economists surveyed by Bloomberg News expect a reduction, their forecasts range from 15 basis points to 40 basis points. The RBI has lowered borrowing costs to a nine-year low of 5.4% through 110 basis points of easing so far in 2019.
The meeting of the six-member RBI Monetary Policy Committee led by Governor Shaktikanta Das comes amid growing concerns about India’s banking and financial sector, and just weeks after Prime Minister Narendra Modi eased fiscal levers by announcing a surprise $20 billion tax break for companies.
The policy decision will be announced at 11:45 a.m. in Mumbai, followed by a press conference 15 minutes later by Das.
Here’s a look at what else to watch out for:
Growth: The RBI has lowered its growth forecast for the current fiscal year three times already, with the latest revision in August pegging growth at 6.9%. Data since has shown gross domestic product expansion slowing to 5% in the June quarter, the weakest pace in six years. That may prompt the central bank to revisit the numbers once again.
The latest growth numbers “look much worse,” Das said recently, referring to RBI’s projection of 5.8% expansion in the April-June period. “There is a slowdown, which was evident and at the last MPC we very clearly said that growth seems to be losing traction and therefore, growth is a matter of highest priority.”
No comments:
Post a Comment