US Fed Rate Cut: In India, similar rate cuts are possible.
US Fed Rate Cut by Deepak Shenoy, Founder & CEO, Capitalmind
"The Fed's 50 bps rate cut comes as a positive surprise, signalling confidence in its inflation control measures. Markets reacted predictably—yields and stocks edged up, and gold rose.
A weaker dollar will help US exports and improve the global economic outlook.
The Fed also projects two more 25 bps rate cuts in 2024 and additional cuts through 2025 and 2026, which is positive for the global outlook.
In India, with CPI inflation below the RBI's target, similar rate cuts are possible.
However, the key challenge remains liquidity in our system, as banks have sufficient deposits but are cautious in lending."
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