RBI Monetary Policy Committee (MPC) Report – April 9, 2025

PART 2 3. Stock Market Reaction • While rate cuts generally support market sentiment, the downside risk from global tariffs and lowered GDP expectations may balance out near-term bullishness. 4. Bond Market Trends • Lower repo rates typically lead to a fall in bond yields, which can result in capital gains for bondholders and greater inflows into debt markets. 5. Currency and Foreign Exchange • The rupee may face mild depreciation pressure following the rate cut, particularly if the U.S. maintains tighter monetary policy. Additional Announcements & Regulatory Measures 1. P2M Transaction Limit Flexibility • The current ₹1 lakh limit remains unchanged for person-to-person (P2P) transfers, ensuring consistency for individual transactions while creating room for enhanced digital payment use cases in the merchant ecosystem. 2. Regulatory Sandbox Becomes Theme-Neutral • The RBI’s Regulatory Sandbox framework, which previously operated under specific themes (like payments, lending, etc.), will now be theme-neutral. My Views – Adarsh Nimborkar As an investment advisor, I believe the RBI's rate cut and shift to an accommodative stance are well-timed and strategic. The global economic outlook is under pressure due to geopolitical tensions and trade tariffs, particularly from the United States. In such a scenario, pre-emptive policy easing provides much-needed liquidity and confidence to the markets. From a portfolio management perspective: • Debt instruments may perform well in the near term due to falling yields. • Equity investors should look closely at rate-sensitive sectors and export-oriented businesses. • Conservative investors should still focus on risk-adjusted returns as volatility may persist due to global spillovers. This decision positions the RBI as proactive and responsive, aiming to strike a balance between growth and stability in a fragile global environment. THANK YOU FOR READING