Attributed to: Mr. Gaurav Garg, Research Analyst, Lemonn Markets Desk

“The RBI’s shift to a neutral stance, is in line with our expectations, and indicates readiness for potential rate cuts, possibly starting in December, depending on incoming data. Overall, we believe MPC acted in a prudent way to balance the domestic growth priorities with global uncertainties like rising crude prices and geopolitical tensions. RBI appears to be comfortable with the growth outlook for H2 FY25 while remaining confident on the last mile disinflation process. As such, we expect any rate cut cycle to be shallow – may be limited to two 25bps rate cuts in the H2 FY25, possibly starting from December.

From markets perspective, Equities had reacted positively after the decision of stance change with rate sensitive realty and banking stocks seeing gains while benchmark yields moved lower.”