In August 2024, the Reserve Bank of India (RBI) decided to keep interest rates steady at 6.50%. Despite this decision, the RBI also projected a possible 50 basis points reduction in interest rates by the end of the fiscal year 2024/25. This forecast was made in response to concerns about inflation levels in the economy.
Even though the RBI chose not to change interest rates in August, it appears to be prepared to make cuts in the final quarter of 2024. These potential rate reductions signal the central bank’s proactive approach towards managing inflation and supporting economic growth. The RBI’s decision reflects its cautious yet optimistic outlook on the economy’s trajectory in the coming months.
The RBI’s decision to maintain interest rates in August while hinting at future cuts highlights its balancing act between controlling inflation and stimulating economic activity. By keeping rates steady for the time being and planning for reductions later in the fiscal year, the RBI aims to navigate the delicate balance between price stability and growth. This strategic approach underscores the central bank’s commitment to managing economic challenges effectively.
Source link : Reserve Bank of India Maintains Rates, Yet Remains Poised for Cuts in Q4 2024
