The hit to GDP growth from punitive US tariffs, along with a benign inflation outlook, sets the stage for the RBI to resume its easing cycle at the conclusion of the MPC meeting on Wednesday 1st October. We are forecasting a 25bp cut to the repo rate to 5.25%. Further ahead, we expect further 25bps cut (to 5.00%) by the end of the year, which is more dovish than market pricing.
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