Commenting on the RBI Monetary Policy Sakshi Gupta, Chief Economist, HDFC Bank has Said, that the space for further policy easing has opened up given the continued moderation in domestic inflation.
The RBI delivered a well-balanced policy, while keeping the policy rate unchanged, in response to rising global uncertainties while the support from GST cuts begins to play out. While the central bank sided with a patient approach awaiting further data clarity in this policy, it did recognise that the space for further policy easing has opened up given the continued moderation in domestic inflation.
A rate cut in December is not a given yet and would depend on tariff outcomes and the strength and pick-up in domestic consumption over this festive season. In the absence of any resolution on the tariff front or further escalation over the coming months, we see a path towards the terminal policy rate moving to 5% in FY26. We expect GDP growth of 6.6% and inflation to average at 2.5% in FY26.