FD rates might fall
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US Fed's rate cut on 18 Sept. by at least 25 basis points might also trigger RBI to cut rate, thereby decreasing FD int rates in the Indian market.
However, RBI's decision to either cut rate or keep rate intact will also depend on the domestic deposit & credit growth projections.
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I don't see it coming atleast in next two months.
By the time US does what they have to do, RBI would react to it and then banks will have to align with it.
Also a factor to consider is that banks are running short of funds as the credit growth has surpassed the deposit growth, so they need PPL to invest in FDs, any dip will move the investors away.
Already ppl moving away from traditional Fds evident from FM and RBI governor statements. Further cut might reduce FDs and that creates imbalance in banking system.
loan rate not decreasing since 2 years