RBI's 25 bps rate cut has little to cheer the market

A 50 bps repo rate cut may have been more substantive for equities to take home

The Reserve Bank of India (RBI)'s Monetary Policy Statement is one of the most tracked events for Indian equities given its relevance on interest rate, inflation trajectory as well as economic growth. With the easing of Consumer Price Index (CPI) inflation to 1.54 per cent in June, the market had high expectations that RBI will adequately pass on this comfort. While the Monetary Policy Committee (MPC) did not disappoint the Street and obliged it with a 25 basis point (bps) cut in repo rate, the move has not entirely pleased the market.

For one, most experts say a 25 bps cut