Perspective on RBI MPC data by Ms. Rajani Sinha, Chief Economist, CareEdge Ratings
Below the Perspective on RBI MPC data by Ms. Rajani Sinha, Chief Economist, CareEdge Ratings
“The cut in policy rate by 25 bps is on expected lines. The change in stance to accommodative indicates that going forward the focus of MPC will be on supporting growth amidst muted inflationary pressure. While RBI has trimmed the growth projection for FY26 to 6.5%, we feel the growth could be lower at around 6.2%. We estimate the direct impact of reciprocal tariff at around 0.2-0.3% of GDP and to add to that there will be indirect impact in midst of heightened global uncertainties.
Inflation is likely to remain muted, though our projection for average CPI for FY26 is 4.2% (marginally higher than RBI’s projection), as we remain concerned about weather related uncertainties like heatwaves etc. In midst of global uncertainties and growth concerns, we expect further 50 bps rate cut in FY26. We do not rule out the possibility of the rate cut cycle being even deeper if the global trade war severely dents growth prospects. ’’
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