Reliance Industries restored all salary cuts with retrospective effect. Several IT majors also did not cut salaries and have announced pay hikes while private banks have said that they will continue with the normal salary increments.
“Roll back of salary cuts, wage hikes will boost household demand,” said Upasna Bhardwaj of Kotak Mahindra Bank adding, “We need to see if pay hikes translate into higher consumer spending.
In an interview with CNBC-TV18, Bhardwaj further added, “There are footfalls but we are getting very mixed signals from various dealer checks and company site information. We are getting positive but yet not as positive.”
Meanwhile, Indranil Sengupta of BofA Securities expects the Reserve Bank of India (RBI) to cut repo rates as inflation falls.
“We have 75 bps of rate cut by March as inflation comes off and Governor Das had said that there is headroom for rate cuts as inflation comes down,” he added.
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