...The economy is slowing down and hence RBI may pause. But at the same time, inflation continues to remain high and if there is further spike, RBI may continue its tightening policy. In crux, how the interest rate cycle pans out is uncertain and so would be the movement in banking stocks. But if country has to grow 7-8% in the future, banking sector would have to grow by 20%. Thus for long-term investors, the time is perfect to take exposure to banking stocks....
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