Morgan Stanley Expects RBI To Inject More Liquidity, Go For Second Rate Cut In April

Morgan Stanley on Friday said that it expects the RBI to take some additional liquidity measures before end-March and another cut of 25 basis points in the repo rate in April after the central bank reduced the policy rate by 25 basis points to 6.25 per cent while it retained the stance at neutral earlier in the day.

- AGENCIES

In a unanimous vote, the MPC embarked on a rate easing cycle, with a 25 bps rate cut, "in line with our and consensus expectations".

In addition, the MPC retained the stance at neutral, as they "remain unambiguously focused on a durable alignment of inflation with the target, while supporting growth," reflecting on the current domestic growth-inflation dynamics, the Morgan Stanley report states. These growth-inflation dynamics open up policy space for the MPC to support growth, while remaining focused on aligning inflation with the target.