While a 25 basis points interest rate cut is already factored, falling food prices could prompt the Reserve Bank of India to cut rates a second time by 25 basis points, feels Pranjul Bhandari, Chief India Economist at HSBC.
Pranjul Bhandari, Chief India Economist at HSBC concurs with the expectation of rate reduction of 25 bps while suggesting there is enough room for another similar rate cut too.
Speaking to CNBC-TV18, she said the rate cut was already expected on the back of falling food prices. Growth is weak and it was weak even before the roll-out of the demonetisation scheme, she says.
Demonetisation will lead to average growth in quarter three and quarter four at 5.5 percent. Hence, an additional cut can be looked at if data comes in sour, she said.
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