Thursday, November 06, 2014

Calls Rise for Rate Cut

There are increasing calls for the Reserve Bank of India to issue a cut in interest rates. With the drop in oil prices having given a temporary respite on inflation, many industry leaders feel that the time is right for RBI to provide a boost to economic momentum by cutting interest rates:

http://articles.economictimes.indiatimes.com/2014-11-06/news/55835667_1_rbi-governor-raghuram-rajan-finance-minister-arun-jaitley-interest-rate

In my opinion, given that the rest of the world markets (including BRICS) are looking comparatively weaker to India as investment prospects, a rate cut right now would reap disproportionate benefits for India 's economy. It could also more strongly herald the start of a steeper growth trajectory for the country.

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