RBI May Cut Interest Rates As Early As This Week: Analysts
"We stick to our call of 50 bps additional repo rate cuts, with the first cut coming in the April meeting," HSBC Chief India Economist Pranjul Bhandari said.
Bank of America Merrill Lynch said, "We reiterate our call that Budget 2015-16 will lead to lower rates to support recovery."
"We continue to expect the RBI to cut policy rates by 25 bps on April 7 (and June) with the Budget meeting his pre-condition of fiscal consolidation and inflation set on his 6 per cent January 2016 target," BofA-ML added.
DBS Bank said, "We continue to expect another 50 bps of cuts by end-June but believe the odds of an inter-meeting cut in March are low."
Commenting on the budget, Nomura said that "overall, the budget is neither populist nor very reformist, in our view, and it reinforces the view that the government's approach to reforms will be incremental rather than in a big bang".
On policy rates, Nomura said, "We continue to expect a 25 bps repo rate cut on 7 April to 7.50 per cent, followed by an extended period on hold until 2016."
"Overall, the Budget is a pragmatic vision and a roadmap for the future. This coupled with the Railway Budget seems a well concerted move by the Government to sustain the existing momentum," SBI said.
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