'Rate cut looks unlikely and there is reason to believe that the cycle is over.'
The heightened global uncertainty due to the US "reciprocal tariffs" on India may cause near-term corrections and market turbulence, but the long-term outlook remains constructive, market experts said on Thursday. The US has announced 27 per cent reciprocal tariffs on India, citing high import duties imposed by New Delhi on American goods.
This period of strong growth not only offers opportunities but also calls for strategic considerations to ensure sustainable development and equitable prosperity in the years to come, suggests Sujan Hajra.
Dr Nagesh Kumar, one of the three new MPC members, wanted the MPC to reduce the repo rate by 25 basis points to 6.25%.
Equity benchmarks ended modestly higher on Friday after the Reserve Bank raised the key interest rate in an effort to cool stubbornly high inflation and defend the rupee. Continuous foreign fund inflows into the capital markets and softening crude oil prices also helped the bourses regain momentum, traders said. The 30-share BSE Sensex ended 89.13 points or 0.15 per cent higher at 58,387.93 after facing volatility during the fag-end of trade. During the day, it climbed 350.39 points or 0.60 per cent to 58,649.19. The broader NSE Nifty went up by 15.50 points or 0.09 per cent to finish at 17,397.50.
ITC was the top laggard in the Sensex pack, tanking 6.97 per cent, followed by L&T, HDFC, SBI, ONGC, ICICI Bank and IndusInd Bank.
Rajan's appointment will be perceived as a positive development.
Last week, the Consumer Price Index-based inflation for the month had contracted to 4.4 per cent.
Food prices, which have contributed to a large part of inflation over recent years, have remained benign, despite unseasonal rain.
Beat gains made by mid-cap, broader indices.
The muted CPI inflation print at 5% earlier this week, followed by a similar WPI number released Wednesday, seems to have spurred India's central bank into action, is how the economists are reading into Reserve Bank of India governor Raghuram Rajan's 25 basis point cut in repo rate.
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