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Yet Another RBI Rate Cut May Not Result in Lower Lending Rates
Dec 5, 2019


The talking heads on TV and investors around you may be talking about India's low GDP growth. Their focus will now shift to whether the RBI's rate cut will translate into better economic activity in the near term.

Like this chart shows, RBI rate cuts have always had a big gap with bank lending rates. It will be a while before lower lending rates stoke the economy.

Therefore, hoping for an immediate revival in the economy is futile. The RBI has no magic wand to do this.

Rather look for stocks that can outperform irrespective of the RBI policy.

Data Source: RBI

This Chart Of The Day was published in The 5 Minute WrapUp - Stocks that Can Outperform No Matter what the RBI Does Today

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