Season Greetings.
The RBI in its 4 th bi-monthly monetary policy
statement for 2019-20 held today, reduced policy rates by 25 basis points,
placing the repo rate at 5.15% with immediate effect. These decisions are in
consonance with the objective of achieving the medium-term target for Consumer
Price Index (CPI) inflation of 4.0% within a band of +/- 2% while supporting
growth.
Liquidity conditions, overall remained in surplus in August
and September 2019. The
path to inflation and interest rates going forward...
RBI is hopeful that several measures announced by the
government over the last two months would to revive sentiment and spur domestic
demand, especially private consumption. Plus, the impact of monetary policy
easing since February 2019 is gradually expected to feed into the real economy
and boost demand.
The new lease of life is infused into debt
market with ease of payments and accounting which will be taken care of by time,
going forward. The Good time to review portfolio and have allocation into short
to mid-term Portfolios of AAA rated securities.
Bouncing back of Equity Market (with
reduction of Corporate Tax) is no reason why market will not be falling again,
yes it will be but certainly not the way the cloud of pessimism was building
up. Hence good time to take advantage of slow pace of growth rate (around 5%) of
economy to build up position in different equity class depending upon the time
frame of investment horizon.
Happy Navratri & Happy Dushera
