25 bps cut in September MPC best possible option for RBI: SBI

The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) may announce a 25 basis points (bps) cut in its September policy meeting as it is the best possible option at this stage, according to a report by State Bank of India (SBI).

- TDG NETWORK

The report highlighted that there is both merit and rationale in going for a rate cut in September, as inflation remains under control and the outlook suggests further moderation.

It stated, “Central Banks’ communication sans cacophony, is a policy tool unto itself amidst all the chaos. No point in committing a Type 2 error (No rate cut with Neutral Stance) in September also. A 25 bps rate cut in September is the best possible option for RBI.”