Comment on RBI MPC by Mr Shrey Jain Founder and CEO SAS Online - India`s Deep Discount Broker
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Below the Quote on RBI MPC by Mr Shrey Jain Founder and CEO SAS Online - India`s Deep Discount Broker
The RBI Governor chose to play safe and maintained a status quo. Though the US Federal Reserve is expected to cut rates in the next policy review and ECB and BOE have started with a rate-reduction cycle, the RBI prioritized inflation management. Overall, the statement can be considered hawkish from the capital market participants point of view.
RBI has maintained the growth and inflation estimates for FY2025 at 7.2% and 4.5% respectively. On this back-drop, implementation of various measures announced in non-inflationary and pro-growth budget, should augur well for equity investors in the medium to long term. We expect a phase of consolidation with sudden spikes in volatility. Investors can use this phase for accumulating good quality stocks at lower levels. Avoid aggressive long positions, as high volatility in global markets may affect Indian equities.
We expect around 50 basis points cut in repo rate before March 2025. Our call to invest in units of exchange traded funds (ETF) tracking Nifty 8-13 yr G-Sec index has worked over last three months. Aggressive fixed income investors can consider buying those units on spikes. Moderate fixed income investors should accumulate units of ETF tracking Nifty 5 year benchmark G-sec
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