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Poosarla Sai Karthik

Tech guy with a busi... • 12h

RBI Hints at a Rate Cut: RBI Governor Sanjay Malhotra says there’s room to cut the repo rate as inflation cools and the data lines up. Many expect a 25 bps cut in December. Let’s break down what this actually means on the ground. Lending and Banking: Upside • EMIs on home, auto, and business loans can soften • Banks get more room to push credit into the economy Downside • FD and savings rates may slip • Bank margins can get squeezed Consumers and Businesses: Upside • Spending picks up, helping real estate, autos, and retail • MSMEs get cheaper capital to expand Downside • Conservative investors earn less and often move toward riskier assets • A softer rupee can make imports pricier, nudging inflation back up Markets and Currency: Upside • Equities usually like lower rates, especially banks and consumption plays • Liquidity lifts growth sentiment Downside • Rupee volatility can rise • Too much easy money risks bubbles A rate cut sounds technical, but it shapes everything from how much we pay on loans to how businesses invest. That’s why every MPC signal matters.

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Looking at the current inflation data, it seems that the RBI might consider a rate cut, and the expectation is the same as India's economic growth has slowed down

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India's inflation rate has now come down to 3.16% year-on-year, which is roughly in line with expectations. Now, the key question is whether the RBI will opt for a rate cut in its next meeting or not.

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