New Delhi, 7 June (IANS). According to Crisil report, the Reserve Bank of India (RBI) has preferred its interest rate cuts to support growth amid low probability of inflation.
Crisil’s report has expected another repo rate in this financial year (FY 26) and after that for some time.
The Global Rating Agency is also expected to be India’s GDP 6.5 percent in this financial year, including the risk of decline due to an American tariff increase.
Crisil has listed some factors that are expected to resort to domestic growth against global tariff risks. The leading company giving global financial information said, “Positive attitude on rain and crude oil prices and healthy external accounts – will provide a buffer against global disturbance with low current account deficit and low -term loans – sufficient foreign exchange reserves.
The report said that the middle class will get the benefit of cuts in interest rates, income tax will be cut and demand will be promoted by low inflation rate of food items.
So far, a reduction of 100 basis points in the repo rate and the reduction of 100 basis points in CRR in the second half of this financial year will reach comprehensive interest rates.
The report said, “The sharp decline in inflation since the previous policy review has allowed MPC to increase monetary assistance. Inflation will remain in line with RBI’s 4 percent target in this financial year due to better monsoon and low crude oil prices.”
Despite external challenges in this financial year, interest rate cuts will be important in supporting domestic growth. The benefit of cutting the interest rates of RBI has started reaching market interest rates and bank loan rates. This will promote consumption with income tax cuts and reduction in inflation.
The change of neutrality in policy attitude reflects a more data-dependent approach in the future. The MPC’s statement also mentions a limited monetary location after the 100-BPS policy rate deduction made so far.
Crisil said, “Additional liquidity has enabled RBI to reach the rate cuts to market interest rates. Since the first rate cut of the central bank in February 2025, there has been a decrease of 15 bps on an average of 15 bps, 30 bps in home loan rates and 20 BPS in auto loans. CRR will help make the faster increase rates easy after cuts.”
-IANS
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