RBI to Cut Interest in the third quarter of current financial year

also marked a significant drop from 8.0%

Rates Further: Slow
GDP and Lower Inflation
Let’s analyze how Monetary Policy
Committee (MPC) decision will impact after
current GDP data and Inflation data.
in April-June 2018.
Inflation:
Retail inflation stood at 2.05 percent in
January 2019 compared with a revised 2.11
percent in December 2018.

Retail inflation dropped further in January

on falling food and fuel prices. The inflation
rate for services like education and health
also fell, bringing down the level of core
inflation, after excluding volatile items like
food and fuel.

GDP:

India's GDP or gross domestic product

growth stood at 6.6% in the quarter ended
December 31, 2018. The slowest rate of
GDP expansion recorded since September
2017. A slowdown in GDP growth momentum
supported the central bank's dovish turn
The Central Statistics Office (CSO) has
earlier this month when it cut key interest
projected GDP growth to average at 7.2 per
rates and changed its policy stance to
cent in the current financial year (2018-19).
"neutral" to boost expansion after a sharp
Also the RBI has projected a GDP growth of
fall in inflation.
7.2-7.4% for the first half of the next
financial year Inflation at a 19-month low and further
weakness in growth creates space for
Economists also estimated that India’s GDP
further cuts.
growth for the 2018-19 will now be 7.0%
compared to 7.2% that it estimated before.

The economic growth for the previous

quarter (July-September) was revised down
to 7.0 per cent from 7.1%. The growth rate