RBI MPC Meeting December 2024 Expectations Live: Will RBI announce rate cut tomorrow?

Nomura, which was one of the first to call out a slowdown in India’s GDP growth, has now said it expects a repo rate cut of 25bps on Friday, contrary to the consensus view of no change. 

According to economists at Nomura, the RBI will move for a rate cut due to weaker growth and the benign one-year forward inflation outlook.

Read full report here

We expect RBI to maintain status quo on policy rates as inflation is yet to align with the 4% target. Moreover, any growth concerns could be addressed through the liquidity route. It could mostly be through Open Market Operations and Variable Rate Repo auction vs. CRR cut. The only action that we expect from the upcoming MPC meeting is reducing the growth expectations to normalised levels of ~6.8%, which is 40bps lower than its original expectation for FY25, with a minor uptick in inflation expectations. We believe that inflationary pressures were present in the Oct’24 CPI inflation print, along with base effects; hence, to avoid the risk of a resurgence in inflation, the RBI is unlikely to make any premature policy moves that could put its credibility at stake . We believe that markets have factored in continuation of Mr Shaktikanta Das as RBI Governor for one more term, which also reinforces the expectation of continued focus on price stability. A dovish policy tone would be used to even out the growth concerns.

Reserve Bank of India (RBI) should cut the key repo rate by 25 basis points in its forthcoming monetary policy meeting scheduled for December 6, apart from taking a host of liquidity enhancing measures, Chandrajit Banerjee, Director General, Confederation of Indian Industry (CII) has said. 

A policy rate cut would lower borrowing costs, spur private capex revival and reinvigorate consumption, thereby providing much-needed support to India’s growth trajectory, Banerjee said in a statement. 

Read full report here

India’s affordable housing segment is expected to reach ₹67 trillion by 2030 and demand is expected to be around 31.2 million units. However, there exists a mismatch in the definition of affordable housing when one compares how policy-makers and developers see it, said Gulam Zia, Senior Executive Director – Research Advisory, Infrastructure & Valuation, Knight Frank India and Lead, CII Task Group on Affordable Housing.

For instance, between 2019 and 2024, the average launch prices in Mumbai Metropolitan Region (MMR) increased at a CAGR of 8 per cent for residential units below 30 sqm (EWS category) vs 4.4 per cent for a residential unit between 60 and 160 sqm (MIG).

Read full report here

The persisting rise in vegetable prices dealt a body blow to headline retail inflation with the Consumer Price Index (CPI) surging to a 14-month high of 6.2 per cent in October. While Chhattisgarh recorded the highest rate of inflation at 8.8 per cent, Delhi saw the lowest at 4 per cent.

With latest reading, headline inflation has breached the Monetary Policy Committee’s (MPC) tolerance range of 2-6 per cent after a gap of 13 months. Now, experts believe that with print exceeding 6 per cent mark, rate review by MPC is unlikely in December and very remote in February.

Read full report ​here​

Manufacturing dragged the economic growth based on Gross Domestic Products (GDP) to 5.4 per cent during July-September quarter of current fiscal year. It was 6.7 per cent during April-June quarter and 8.1 during corresponding quarter of last fiscal.

According to data released by the Statistics Ministry, real GVA (Gross Value Added) has grown by 5.6 per cent in Q2 of FY25 against the 7.7 per cent in Q2 of the previous financial year. Nominal GVA witnessed a growth rate of 8.1 per cent in Q2 of FY25 against 9.3 per cent growth rate in Q2 of FY24.

Read full report here

The six-member ​​Monetary Policy Committee (MPC) ​​decided to keep the repo rate on hold at 6.50 per cent, even as it continued with its disinflationary stance of “withdrawal of accommodation”. Both decisions were made by a 4-to-2 majority.

“Ensuring price stability will ensure growth. With GDP growth holding well, we decided to hold the repo rate,” Governor Shaktikanta Das said after the 50 ^th MPC meeting.

Read more ​​here.​​

​The Monetary Policy Committee (MPC)​ kept the policy ​repo rate​ unchanged at 6.50 per cent at its bi-monthly meeting by a majority of 5 out of 6 members.

The MPC, however, unanimously decided to change the policy stance to neutral from withdrawal of accommodation even as it decided to remain unambiguously focused on inflation target. This could be a precursor to a rate cut in February, say experts.

Read more ​here.​

Reserve Bank of India Governor Shaktikanta Das on Wednesday said a change in stance doesn’t mean that the next step is a rate cut in the very next meeting.

The six-member monetary policy committee (MPC), which met from October 7-9, had decided unanimously to change the stance to ‘neutral’ from ‘withdrawal of accommodation’. However, it kept the repo rate unchanged at 6.50 per cent by a majority of 5 out of 6 members.

Read more here.

The latest GDP (Gross Domestic Product) print, which shows the economy growing by just 5.4 per cent in real terms in the second quarter of FY25, is likely to put the Monetary Policy Committee (MPC) and the Reserve Bank of India (RBI) in a quandary. 

In its last two meetings, the MPC kept policy rates on hold based on a sanguine view of the economy. Taking the line that India’s growth outlook is resilient supported by brisk kharif sowing, festival spending and healthy credit growth, it projected growth at 7.2 per cent for FY25, with Q1 and Q2 projections at 7.3 and 7.0 per cent, respectively.

Read more here.

The Reserve Bank of India’s (RBI)Monetary Policy Committee (MPC) meeting to determine the policy rate in the country commenced today in Mumbai.

Chaired by RBI Governor Shaktikanta Das, the three-day meeting will run from December 4 to December 6, with the Governor announcing the policy decisions on Friday, December 6.

This meeting takes place amid significant economic challenges, including lower-than-expected GDP growth, high inflation, and declining production levels, all of which have raised public concerns.

Read more here.

Notwithstanding the second quarter (Q2FY25) GDP growth slowing to a two-year low, the rate-setting monetary policy committee (MPC) is likely to stay put on the repo rate as retail inflation rose beyond its 6 per cent tolerance level in October.

The six-member MPC, which is schduled to meet from December 4 to 6, is seen giving primacy to bringing down retail inflation to 4 per cent.

The MPC members are expected to hold their ground despite recent observations of a couple of Union cabinet ministers and the chief economic adviser about the need for softer interest rates.

Read more here.