Most of the focus in global financial markets Thursday centered on the Swiss National Bank's surprise decision to drop its ceiling for the franc against the euro.
But another central bank took surprise action too. The Reserve Bank of India cut its benchmark repurchase rate by 25 basis points to 7.75 percent, the first reduction in 20 months.
Ace investor Jim Rogers approved of the move. "The Reserve Bank of India is one of the better-manned central banks in the world," he told
The Economic Times of India.
"They seem to understand what needs to be done. And they are doing a better job than most. I wish the Reserve Bank of India were running the U.S. Federal Reserve."
To be sure, while the move sends a positive signal to global investors, it's not doing much for global markets. And that makes things difficult for India, Rogers said.
"It is very unlikely that India can stand alone for an extended period of time. If the U.S., Europe and Japanese markets go down, India will not be standing long in the face of all of that," he explained.
"I own Indian shares, but I am not overly optimistic on the India story. Prime Minister Modi has said a lot of good things. Unfortunately, he has not been producing any solid result yet."
Investors should learn to sell short, Rogers notes, "because over the next couple of years, selling short is going to be very profitable."
Indian stocks rallied the most in eight months Thursday, thanks to the rate cut. The S&P BSE Sensex index of Indian stocks has gained 34 percent in the last year.
Some market participants were more enthusiastic than Rogers. "The cut signals that the battle on inflation is broadly won," said Suyash Choudhary, head of fixed income at IDFC Asset Management in Mumbai, told
Bloomberg.
"Positivity around Indian assets should continue, going forward."
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