Reports indicate that the Monetary Policy Committee meeting has already taken place and we now await the RBI announcement. While consumer price inflation was at 6.58 percent in February, that’s yesterday’s news.
Crude oil prices have collapsed and that will pull down headline inflation. More importantly, a rate cut will be a signal that the central bank has our backs.
Here’s how much other central banks have cut their rates in response to the economic damage caused by the COVID-19 pandemic:
From Jefferies Equity Research:
Rate cuts by central banks in March 2020
USA 150 basis points
Canada 100 bps
South Africa 100 bps
Vietnam 100 bps
New Zealand 75 bps
UK 65 bps
Australia 50 bps
Brazil 50 ps
Mexico 50 bps
Philippines 50 bps
Indonesia 25 bps
Malaysia 25 bpsThailand 25 bps
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