Thread by @Trinhnomics

RBI cut rates by 25bps to 5.15% from 5.4%💥 Btw, RBI also the 1st to cut in Asia this year, commencing the easing cycle. In retrospect, that was a good call to cut as economic data is not good given the liquidity squeeze on shore.

🇮🇳✂️🕊️🕊️🕊️🕊️

https://twitter.com/Trinhnomics/status/1180000712417140741

Next meeting is 5 Dec likely saving some ammunition but frankly should have front-loaded it. Markets were slightly disappointed w/ the as expected cut (esp bonds obvs w/ worries about December issuance).

Did a bigger cut to GDP forecast to 6.1% from 6.9% for FY20. Help needed!

Real rates less tight after the 25bps cut to 5.15% but would have been better if to 5% as it is still tight & given the contracting PMIs, imports, slowing on all cylinder economy & not to mention corporate tax cut of 10%, more help needed.

5 December cut coming 🇮🇳✂️🕊️

Here are the market reactions to the 25bps cut. In a word - disappointed. Haha, sad but true.

Sensex -0.12% (not too disappointed as did get a 25bps cut)
Govies not happy at all as yields rose 1.8bps for 5y

Now that the low-hanging fruit is out of the way (rate cut is easy to do vs say other reforms that require a bigger consensus).

What's next for India to resolve long-standing challenges? 🇮🇳 Investors are counting on India to deliver on reforms (and ordinary Indians too 🙇🏻‍♀️)!