Cut the rates, never mind the spreads

..........With the pace of growth of deposits now having slowed to decade-lows, some banks have been compelled to up rates to be able to hold on to customers. So, at a time when banks should have been able to lower loan rates—in response to the signalling from the Reserve Bank of India (RBI)—they’re not doing so. In a sluggish economic environment, loan growth too has decelerated—though it continues to outpace the increase in deposits—and it might have helped if banks had been able to stimulate some demand............

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