Rate Cut on the Cards? RBI's Next Move Amidst Geopolitical Tensions

The State Bank of India (SBI) has advocated for a 25 basis point rate cut by the Reserve Bank of India (RBI) in its upcoming bi-monthly policy review, calling it the 'best possible option.' Despite this, experts anticipate the central bank may maintain the current status quo.

The Monetary Policy Committee (MPC), chaired by RBI Governor Sanjay Malhotra, is set to begin deliberations amidst the backdrop of geopolitical tensions and significant US tariffs on Indian goods. The verdict from these discussions will be unveiled on October 1.

Experts, including Dharmakirti Joshi from Crisil Limited, argue there is room for rate cuts, driven by lower-than-expected inflation and recent adjustments in GST rates. However, any significant moves may only materialize once further fiscal measures and the impact of recent geopolitical developments are fully considered.

(With inputs from agencies.)