RBI likely to cut repo rate by 25 bps in Dec amid low inflation, strong growth: Report
Kolkata (PTI): The RBI could announce a 25-basis point repo rate cut in its upcoming December monetary policy meeting, driven by a sharp decline in inflation and strong growth momentum, a report by credit rating agency CareEdge said on Tuesday.
It said inflation has eased to a decadal low of 0.3 per cent in October, well below the RBI's 4 per cent target threshold, creating policy space for rate cuts.
The current repo rate stands at 5.5 per cent.
"Factors such as stable Brent crude prices, healthy reservoir levels supporting rabi sowing, and muted price pressures arising from excess capacity in China should help prevent any sharp rise in inflation," the report stated.
While GDP growth has accelerated to 8.2 per cent in the second quarter of the 2025-26 fiscal, CareEdge projects a moderation to around 7 per cent in the second half of the financial year, as the boost from front-loaded exports fades and post-festival consumption moderates.
For the full fiscal, the report forecasts GDP growth at 7.5 per cent.
It said that with CPI inflation expected to average around 3.7 per cent over the next 12 months, the real policy rate at current levels would be roughly 1.8 per cent – above the estimated neutral range of 1-1.5 per cent – indicating scope for a rate cut.
Despite external headwinds, including prolonged trade negotiations with the US and geopolitical tensions, India's external sector remains resilient with foreign exchange reserves rising by USD 27 billion to USD 693 billion as of mid-November, it noted.
CareEdge expects the RBI to revise its FY’26 inflation projections to around 2.1 per cent and growth forecast to around 7.5 per cent in the December policy meeting.
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CM Siddaramaiah alleges ‘criminal conspiracy’ in Sringeri recount, vows legal action
Bengaluru (PTI): Alleging a “criminal conspiracy” by BJP candidate D N Jeevaraj in the Sringeri Assembly poll recounting, Karnataka CM Siddaramaiah on Tuesday said the outcome was manipulated after valid postal ballot votes in favour of Congress leader T D Raje Gowda were tampered with during the recounting process.
Following a Karnataka High Court order on an election petition filed by Jeevaraj, challenging Raje Gowda’s election, the reverification and recounting were conducted on Saturday.
After the reverification and recount of postal ballots for the Sringeri Assembly constituency, votes polled in favour of Raje Gowda were reduced by 255, the returning officer said.
A report on the matter has been submitted to the Election Commission of India for further action, the officer added.
Congress leader Raje Gowda had won the 2023 Assembly polls from Sringeri by 201 votes, defeating his nearest rival Jeevaraj.
Addressing a press conference in Bengaluru, Siddaramaiah said the High Court had directed the recounting of postal ballots and that irregularities were noticed during the exercise conducted on May 2.
“This is a clear case of criminal conspiracy,” Siddaramaiah said, alleging that valid votes cast in favour of Raje Gowda were altered after being accepted by counting agents of all parties, including Congress, BJP, and JD(S).
He claimed that during the recounting of postal ballots, 255 votes were initially accepted as valid by all agents but were later tampered with by subordinate officials.
“There is a second mark on the votes polled in favour of Raje Gowda. They had accepted these as valid votes. Subsequently, another mark was made by officials. This is a clear case of criminal conspiracy,” he said.
When asked who was behind the alleged conspiracy, the CM replied, “It was hatched by Jeevaraj and others. It is planned.”
Siddaramaiah further alleged that the returning officer acted improperly by declaring the result despite the presence of an Election Commission observer during the recounting.
“Immediately after the counting, the returning officer announced the result. He should not have done so; this is against the law,” he said.
He pointed out that Raje Gowda had originally won by 201 votes, but after the recounting, the BJP candidate was declared the winner by 52 votes.
“The BJP has committed a criminal act of conspiracy. This is not vote chori but vote dacoity,” he alleged.
The CM said a police complaint had already been filed by Raje Gowda’s election agent, Sudhir Kumar, and emphasised the need for electoral integrity.
“We want transparency and free and fair elections. That is what our Constitution mandates,” he added.
Stating that the government would pursue legal remedies, Siddaramaiah said, “We are preparing an appeal challenging the returning officer’s announcement in a court of law.”
Responding to a separate query on elections in other states, the CM said there appeared to be an anti-incumbency factor in West Bengal, while results in Tamil Nadu were “surprising,” adding that Vijay’s party was emerging as the largest there.
Following the victory of party candidates in Bagalkote and Davanagere South, Siddaramaiah expressed confidence about future electoral prospects in Karnataka.
“Even in 2028, we will win the Assembly elections. We will come back,” the CM said.
Siddaramaiah added that he would order a forensic examination into the alleged tampering of postal ballots.
