Live Updates > Live Update Details
2025-07-28 17:58:41
[India's overnight interest rate plummeted, liquidity was greatly loosened, and the interest rate cut cycle is coming? ] ⑴ India's benchmark overnight interest rate has fallen sharply in the past three trading days, indicating that the liquidity of the banking system is undergoing significant changes. ⑵ The Mumbai Interbank Offered Rate (MIBOR) plummeted to 5.40% on Monday, compared with 5.82% last Wednesday. ⑶ The Secured Overnight Rupee Rate (SORR) also fell from 5.76% last Wednesday to 5.29%, a drop of 47 basis points. ⑷ This downward trend reflects that there is ample funds in the banking system, and most of the funds are not deposited in the Reserve Bank of India, which has eased the liquidity pressure in the market. ⑸ Traders pointed out that the weighted average interbank lending rate and the weighted average tri-party repo rate have both fallen below the policy rate, but are still above the lower limit, which is exactly what the Reserve Bank of India hopes to achieve. ⑹ This sign may indicate that the Reserve Bank of India will have more room for easing in future monetary policy.
