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India may witness another policy rate cut before the end of the year, supported by the government's recent GST simplification measures and a broader phase of domestic regulatory easing, according to a report. The analysis suggests that the worst phase offiscal consolidation may now be over, paving the way for a gradual recovery in credit demand. "We expect an additional policy rate cut before year-end, and the recent GST simplification signals that peak fiscal consolidation is behind us. We exp
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FAQ :
An additional policy rate cut by the RBI is expected before the end of the year.
Recent GST simplification measures and a broader phase of domestic regulatory easing are supporting the outlook for a rate cut.
The RBI's Monetary Policy Committee recently decided to keep the policy repo rate unchanged at 5.5% and maintain a neutral stance on monetary policy.
Yes, external challenges such as tighter U.S. immigration rules for H-1B visa holders and higher U.S. import tariffs on Indian goods could temper credit demand.
The rationalisation of GST rates, along with favourable monsoon conditions, has improved India's near-term growth prospects and led to an upward revision of the GDP growth projection for FY26.
A gradual recovery in credit demand is expected, with an uptick already seen in lending to SMEs, agriculture, and housing.
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