Happy Holi! The season of colours is upon us. On this happy day, we mark the beginning of spring and the end of winter. May this auspicious day add colour to your lives.
Key Takeaways
Policy continuity: The RBI held the repo rate at 5.25% and retained its “Neutral” stance, reinforcing the December policy framework.
“The patterns repeat, though the details never do.”
—Howard Marks, American investor and co-founder of Oaktree Capital Management
Now that I have your attention with that clickbait headline, let’s get down to the truth!
Fixed income funds have delivered strong returns over the past two years as inflation declined sharply from the post-pandemic surge of 2022–23. This disinflationary impulse enabled central banks to pivot decisively towards monetary easing, with 211 and 189 policy rate cuts recorded by global central banks in 2024 and 2025, respectively, well above the post-GFC peak of 181 cuts in 2009 (Source: Bloomberg).
Liquidity as the New Driver of Market Dynamics
Gold is often praised as a protection against inflation, but it’s important to remember that correlation is not causation. Throughout my career, I have observed that gold offers reasonable protection against inflation. It is not a perfect hedge, but it is better than most alternatives for those who wish to protect themselves from inflation risk.
For years, Indian car buyers have prioritised mileage, with hatchbacks and sedans symbolising urban aspirations. Yet, even then, Multi-Purpose Vehicles (MPVs) held their ground – valued for their space, power and durability.
The Indian Rupee (INR) has been on a weaker trajectory in 2025, depreciating by 3.7% against the US Dollar as of September 30, 2025. This comes even as the US Dollar Index has declined by around 10% against other major currencies. Consequently, the INR’s fall against key global currencies has been even more pronounced.
