RBI policy: Investors to benefit from falling interest rate regime

The Reserve Bank of India (RBI) has kept interest rates on hold and maintained its stance to mitigate inflationary risks, at its latest monetary policy meeting. India’s GDP growth forecast remained unchanged at 6.5%, with a marginal cut in CPI inflation from 5.2% to 5.1%. While some expected a change in the policy stance following the sharp fall in CPI inflation to 4.7% in April 2023, RBI MPC chose a wait-and-watch approach, conscious of global geopolitical uncertainty and potential El-Nino disruption to food inflation. The debt market outlook remains positive as rate easing expectations build up for the end of FY2024 locally and globally.