New Delhi, Sept. 28 -- Since February, the Reserve Bank of India (RBI) has lowered the repo rate by 100 basis points. So far, the cuts have passed through only partially, with lending and deposit rates reflecting just part of the policy move. Some further transmission may still occur as banks reprice loans with a lag, even as views remain divided over the rate cut decision at the monetary policy meeting amid low inflation.

The uneven transmission reflects the cautious behaviour of the banks: while stronger domestic demand and GST rate rationalization could support lending, pressures to protect deposits and subdued investment appetite amid global headwinds mean banks will be in no hurry to slash rates sharply.

Skewed signals

Data highli...