Central bank cuts repo rate by 25 basis points

The Reserve Bank of India (RBI) is anticipated to implement two more interest rate cuts to stimulate the Indian economy, according to Manish Banthia, CIO of Fixed Income at ICICI Prudential AMC – which manages funds worth $2.3 billion. However, future policy adjustments will depend heavily on the economic data, as monetary policy operates with a time lag. Anand Shah, Chief Investment Officer PMS & AIF at ICICI Prudential AMC explained that the recent market downturn was primarily due to excessive valuations, not fundamental economic weaknesses. He emphasised that the sharp drops across smallcap, midcap, and largecap stocks have now brought valuations to more reasonable levels, making current market conditions more appealing for investment.