The aftermath of the collapse of technology stocks swept through the Asia-Pacific, with Korean stocks plunging and leading the decline. Bitcoin once fell below the 60,000 mark, and silver fell another 10%.

# Source: Wall Street Insights

# By Zhao Ying

The Reserve Bank of India (RBI) decided on Friday to keep its benchmark interest rate unchanged. Prior to this, Trump announced that he would slash tariffs on Indian goods from 50% to 18%. This substantial reduction has significantly boosted market expectations. The Indian government also increased spending in its budget this week, which will help support the rupee exchange rate and provide more room for the RBI to adjust its policies.

The Reserve Bank of India opted to hold steady on its benchmark interest rate on Friday, choosing a wait - and - see approach after the US - India trade agreement eased growth concerns. This decision reflects the central bank's satisfaction with the current policy settings, believing that economic growth is strengthening and inflation remains moderate.

All six members of the RBI's Monetary Policy Committee (MPC) voted unanimously to maintain the repo rate at 5.25%, which was in line with the expectations of most economists surveyed by Bloomberg. The policy stance remains neutral, indicating that the central bank is likely to stay on the sidelines for some time.

In his speech, RBI Governor Sanjay Malhotra stated, "The successful conclusion of the trade agreement bodes well for the economic outlook". Senior Indian government officials said this week that economic growth may exceed their maximum forecast of 7.2% for the next fiscal year.

According to Xinhua News Agency, Trump said that he and Modi reached a bilateral trade agreement. The United States will cut the so - called "reciprocal tariffs" on Indian goods from 25% to 18%, which will take effect immediately, and India will also reduce tariffs and non - tariff barriers on US goods simultaneously. This unexpected trade agreement has boosted the growth prospects of Asia's third - largest economy.

## Trade Agreement and Fiscal Stimulus Boost Confidence

Trump previously announced a reduction in tariffs on Indian goods from 50% to 18%, and this sharp cut has significantly improved market expectations. As part of the agreement, Indian Prime Minister Modi agreed to stop purchasing Russian oil and substantially increase the procurement of US oil.

The Indian government also increased spending in its budget this week, which helps support the rupee exchange rate and provides more room for the RBI to adjust policies. In addition to the agreement with the United States, New Delhi also signed a major trade agreement with the European Union this year.

After the central bank's decision was announced, the rupee maintained a slight upward trend. Indian government bonds extended their losses because the central bank did not announce any new liquidity measures, and the 10 - year bond yield rose by as much as 6 basis points to 6.70%.

Gaura Sen Gupta, an India economist at IDFC First Bank, said, "The RBI's tone shows satisfaction with the current policy settings, with growth strengthening and inflation remaining moderate." She expects the Monetary Policy Committee to enter a state of "long - term pause".

The RBI has cut interest rates by a total of 125 basis points since February last year, including a 25 - basis - point cut in December, as inflation has been well below the 4% target. Malhotra predicts that the inflation rate for the three months ending March 31 will be 3.2% and may exceed the target in the first two quarters of the next fiscal year. Malhotra stated that the full - year inflation and growth forecasts will be released after the government releases the new data series in April. The Indian government currently expects economic growth to exceed 7% in the fiscal year starting from April 1, while growth is projected to reach 7.4% in the current fiscal year.

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