RBI likely to cut rate on August 2

The Reserve Bank of India is likely to cut the benchmark lending rate by at least 25 basis points in its third bi-monthly monetary policy review on Wednesday.

The expectation comes in the wake of retail inflation receding to record low levels, say experts and bankers.

Bankers expect RBI, which has kept rates on hold at 6.25% for the fourth straight time citing risk to inflation, to change its monetary stance and may even go for an aggressive rate cut.

“The expectation is of rate cut of a minimum 25 basis points as inflation has eased and also as industrial growth continues to remain weak,” Bank of Maharashtra managing director R P Marathe said.