......Now, from the near-plausible to the ridiculous explanation for RBI staying pat at 8%. I must confess that I hadn’t heard this line of reasoning in at least the last few decades. I apologise for my deficiency. But the ancient regime, and equally Lone Rangerish, argument for high if not higher repo rates is that such rates affect real deposit rates, which affect the rates of household savings. Now, there are precious few, if any, empirical studies worldwide showing any relationship between savings rates and real deposit rates. But there are several studies.......
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