RBI cuts repo rate to 5.40%

Maintaining an accommodative stance, the Reserve Bank of India has trimmed repo rate by 35 bps to 5.40%. This was the 4^th consecutive rate cut by the bank. Given the fact that weak core inflation has kept the headline rate below the central bank’s 4% mandate for the 11th straight month, this move was anticipated by the industry. Though the RBI has cut GDP estimate to 6.9% as the country faces numerous domestic challenges and global headwinds, RBI Governor Shaktikanta Das sought to assure that the ” economic slowdown is cyclical and not a deep structural slowdown”.