According to PHDCCI President Hemant Jain, the decision to lower the Repo rate to 6% and adopt a tuning position will provide a cushion to the Indian economy due to the negative impacts of global economic uncertainty.
He said the income tax easing announced between 2025 and 2026 will improve consumer sentiment along with lower interest rates and accelerate GDP growth through increased individual final consumption expenditure.
On the industry front, reducing policy rates reduce debt service costs and provides the industry with extra cushioning to absorb external shocks, such as the recent US tariff announcements.
Supported by a strong seasonal revision of vegetable prices, a normal monsoon assumption and a massive reduction in global oil prices, we expect inflation to remain within RBI targets for the upcoming quarter.
Under previous policy in February, RBI trimmed its reporate at 25 basis points to 6.25%. This rate came after previous rate cuts in May 2020.
(Input from PTI)
