Sensex and Nifty end seven-day rally, dropping nearly 1%

On March 26, 2025, India's key stock indices, Sensex and Nifty, ended their seven-day winning streak. They fell by nearly 1% due to profit-booking, particularly in the banking and IT sectors. The Sensex dropped 728.69 points, closing at 77,288.50. Meanwhile, Nifty fell 181.80 points to end at 23,486.85. In financial news, the Reserve Bank of India (RBI) is expected to lower the repo rate by 75 basis points for the financial year 2025-26. Earlier, on February 7, 2025, the RBI had already cut the repo rate by 25 basis points, marking its first decrease in five years. SBI Research suggested the RBI may continue this trend in its upcoming monetary policy meeting in April 2025. SBI Research believes that stable price conditions will allow the RBI to lower the repo rate further. The first potential cut is expected in April 2025, followed by another in August. A new cycle of cuts could begin in October 2025. For borrowers, a cut in the repo rate can mean lower interest rates on loans linked to it, such as home loans. After the recent rate decrease, many banks have already reduced their home loan rates, making borrowing cheaper. A further reduction in the repo rate would increase affordability for borrowers. In terms of inflation, it was reported that Consumer Price Index (CPI) inflation dropped to 3.6% in February 2025, the lowest in seven months, attributed to falling food prices. However, inflation rates differ by state. CPI inflation is expected to average 4.7% for the financial year 2025. In the fourth quarter, it could fall to around 3.9%. Looking ahead, inflation for FY26 might be between 4.0% and 4.2%.