Rate-sensitive sectors to gain after RBI cuts repo rate by 25 basis points

Amid dismal deposit growth, banks have not been able to pass on benefits of the earlier rate cuts to borrowers, impacting economic growth

At a time when the Street is worried about the below-normal monsoon prediction by Skymet, as well as slower growth in India and global economies, the Reserve Bank of India’s (RBI’s) monetary policy provides relief, mainly to rate-sensitive sectors such as auto, realty and non-banking financial companies (NBFCs). 

With some experts expecting more rate cuts going ahead, it could further help these sectors and enhance economic growth.

Slowdown in public and private consumption has weighed on India’s growth. The RBI, too, lowered its gross domestic product (GDP) forecast for FY20 to 7.2 per cent from 7.4 per cent. 

Sandip Raichura,