Raghuram Rajan, The Governor of Reserve Bank of India, announced a repo rate cut on Tuesday in its monetary policy review. The cut was made of 25 bps from 7.5% to 7.25%. It was predicted largely by analysts and bankers alike and was predicted by Sangam time and again from the last few months. This has led to creation of a great opportunity in the debt fund segments and it is expected to positively impact returns in the coming time.
The fall in the retail inflation with slowdown in Industrial output has led to the rate cut and the same was expected too.
The markets had expected a steeper cut in the form of 50 bps and not fulfilling it hopes led to a downturn in to the markets.
The further hopes of rate cuts is to be addressed in August 2015, in its bi-monthly policy review.
Keep holding to your investments in debt fund segments and plan to allocate your funds with the right assets in order to increase your returns in the times to come.
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