New Delhi, May 11 -- It can be said with some certainty that under normal conditions, there would be at least another 50 basis points of cuts by the Reserve Bank of India (RBI) in the repo rate this year (100 basis points form a percentage point).

The reasons are quite clear.

First, RBI changed its stance in its last policy statement to 'accommodative.' It also issued a clarification of its stance nomenclature, saying that the shift could mean a further lowering of policy rates. Second, liquidity has been provided on a near real-time basis by RBI to ensure that the system is in surplus.

Third, RBI lowered its inflation forecast to 4% for 2024-25, with the India Meteorological Department (IMD) providing further comfort by forecasting a ...