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RBI to cut policy rate by 0.25% on April 5th: Deutsche Bank report

According to a report by Deutsche Bank, RBI is likely to cut only 25 bps in the upcoming monetary policy due to the fact that rate cut space is scant. Though, demand for policy rate is considerable but given the central bank inflation, RBI cannot make it more than 25bps.

As per the global financial services major, RBI is sticking to its goal of maintaining 1.5- 2 percent average real interest, along with an average CPI inflation forecast of 5 percent for the current financial year, which is 2016 -17  has left no room for bringing down the repo rate below 6.50 percent.

RBI expected to opt for 25 bps rate cut: HSBC

In a research note Deutsche Bank has said that if RBI cuts rates by 50 bps on April 5th, which is not their base case scenario, probably the apex bank will indicate an extended pause, and risks are that market will factor in that the rate cut cycle is over.

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Parul Srivastava

She likes to express herself through her write-ups. She doesn’t believe in doing different things but she enjoy doing things differently.
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