Reacting to the Reserve Bank of India’s latest monetary policy decision, Upasna Bhardwaj, Chief Economist at Kotak Mahindra Bank, said the move to cut the repo rate and introduce liquidity support was broadly in line with the bank’s expectations.
She noted that the central bank has kept the door open for additional policy easing in the coming months. “We see scope for another 25 basis points reduction, taking the terminal policy rate closer to 5 percent,” Bhardwaj stated.
According to her assessment, after reaching that level, the RBI may shift to a prolonged pause phase, depending on the domestic inflation path and global financial conditions.