INSUBCONTINENT EXCLUSIVE:
Global brokerage Bank of America Securities cut growth forecasts for India and suggested a sharp benchmark rate cut to cushion the damage to
quarter and 80bps to 4 per cent for the June quarter on Covid-19 related shutdowns.
A large number of leisure, travel and hospitality
businesses have been hit hard due to preventive measures to close shops and malls.
BoFA Securities highlighted that high real lending rates
continue to exert a drag on growth
Although nominal bank MCLR has fallen 54 bps in the current fiscal till date on RBI easing, real MCLR has jumped 67bps with core WPI
Second, it will likely cut again in June with inflation set to fall to its 2-6 per cent mandate
it said in a note.
The report prepared by Indranil Sen Gupta and Aastha Gudwani said BofA India Activity Indicator continues to point to a
But it added that shutdowns needed to contain the Covid-19 outbreak will likely pull down activity.
India's GDP growth slipped to a nearly
7-year low of 4.7 per cent in October-December 2019, weighed by a contraction in manufacturing sector output