Will RBI reduce rates? Experts see a reduction of 25 basis points in February MPC

With the Indian economy moving to a decisive stage after the budget 2025, there is all attention at the upcoming monetary policy committee meeting at the Indian Reserve Bank (MPC) on February 7. At the Ribo rate, quoting government policies that focus on growth and reduce inflation fears.

MADAN Sabnavis, chief economist at BANK OF BARODA, believes that the conditions of macroeconomics have been reduced. “The conditions seem to support the price reduction supply, especially after the budget gave stimulating growth. There are expectations that inflation will decrease and the rest is taken here even though the latest number of inflation exceeds 5 %. He said that the only concern now is the results of the trade war. Cheroura under pressure again.

The state of cash dilution is strengthened through recent financial measures. Edelweiss Mutual Fund notes that monetary policy will play an important role in supporting economic growth. “Monetary policy will have to make a heavy lifting to support economic growth. As a result, the chances of reducing the average of 25 basis points in Feb Feb MPC have increased significantly. We expect to reduce at least 50 basis points in the ribau rate in the first half of CY2025,” mentioned the Fund House .

M motthy nagarajan, fixed income in Tata Asset Management, expects a shift in the position of politics. “The government has done somewhat to stimulate the demand. It is expected that the CPI enlargement for the current quarter will be 4.7 per cent, and inflation will reach one year, according to RBI expectations, 3.8 per cent. By buying in dollars, long-term ripers, purchase on the NDS-om screen. The system.

The financial background also plays a role in forming expectations. The budget of 2025 committed to the financial monotheism road map, with a 4.4 % financial deficit target – the previous 4.5 % target for FY26. However, government borrowing remains on the upper side, with net borrowing at 11.54 rupees and total borrowing at 14.82 rupees. This is significantly due to the low dependence on small savings, which decreased to 3.43 rupees of rupee 4.11 crore rupees in the fiscal year 25, according to Nagarajan.

It also added the government to enhance consumption to the expectations of lowering prices. The government is trying to start the economy by increasing consumption. The government reduced income tax rates and gave a reward of 1 Kah Rs. To investors who pay taxes. This can be used by taxpayers for consumption or payment of their loans. The government maintained its capital expenses at 11.20 Cham rupees, and focused more on the public and private partnerships to increase capital spending in the economy. Most of the low investment in roads, railways and defense has been made. For more progress, it requires state governments to improve government and implement reforms at the state level. “

However, not all experts are convinced that lowering prices are imminent. Rumki Majumdar, economist and manager at Deloitte, believes that RBI will adopt a cautious position. “Given the action of the budget of managing inflation and increasing credit growth, it will be a difficult invitation.

Umeshkumar Mehta, CIO, Samco Muteal Fund, corresponds to the fact that interest rates in the bond market in the largest economy in the world are mainly rising mainly due to increased inflation expectations due to customs tariffs. Looking at these total economic factors and the constant appreciation of the US dollar and Indian rupee. It faces an increase in consumption stress.
Through different views on the timing and extent of price discounts, the MPC meeting in February will be very important in determining the tone for the first half of 2025. While economic stimulation of the budget and relief of inflation may justify a reduction, the pressure of global uncertainty and currency pressures can The RBI approach is surprised. Currently, the market is watched and waits.