Another Central Bank Rate Cut in India

October 4, 2019

The Reserve Bank of India cut its benchmark repo interest rate for the fifth time since February. Today’s reduction to 5.15% was 25 basis points, and the total decline of all five moves has been 135 basis points in size. The reverseĀ  repo rate also was trimmed by 25 basis points to 4.90%. A statement released by the central bank explaining its interest rate cut today unveils a downwardly revised growth forecast and postulates that a slight uptick of inflation will be temporary. India’s composite PMI for September (49.8) and service-sector purchasing managers index of 48.8 each fell below the 50 level that separates improvement from deterioration. Both indices represent 19-month lows.

Copyright 2019, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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