Whalesbook
Third-quarter inflation in India is trending significantly below the Reserve Bank of India's (RBI) projections. With retail inflation at a mere 0.25% in October, the path is cleared for a potential repo rate cut by the Monetary Policy Committee (MPC) next month. This move is supported by favorable real interest rates and anticipated boosts from government tax and GST measures, aimed at stimulating economic growth. However, the banking sector faces potential challenges including narrowed spreads and deposit growth lagging credit growth.