There is important news waiting for common people. The Indian economy is on the upswing in the third quarter of FY 2024-25, with a projected growth rate of 6.7% for the upcoming fiscal year and an average inflation rate of 3.8%. According to the Reserve Bank of India’s latest monthly economic report, signs of recovery are evident as we head into December, with forecasts suggesting that inflation will stay below the 4% target in the next financial year.
This sets the stage for a potential interest rate cut in February. Experts think that lowering rates could make loans more affordable, which might boost both consumption and investment.
What’s the inflation outlook?
With the economy expected to grow by 6.7% next fiscal year and inflation averaging around 3.8%, the Monetary Policy Committee (MPC) has some leeway to lower the key policy rate in their February meeting. High Frequency Indicators (HFI) for the third quarter of 2024-25 show that the Indian economy is bouncing back from the slowdown experienced in the second quarter, thanks to strong festive spending and ongoing growth in rural demand.
Meanwhile The RBI has clarified the rules for panel chart and panel interest on loans under the new guidelines applicable from 1 September 2024, the main objective of these rules is to protect borrowers from undue penalties and make banks more transparent in the lending process, and the default charge will be “reasonable” and only on the defaulted amount. Under the new rules, banks and financial institutions will no longer be able to levy additional charges on borrowers for late payment of EMIs or violation of loan terms and the penal charge will be levied only on the default amount, and the same penalty will be levied on retail and corporate borrowers for the same loan product.
