Was it a brilliant decision?

"This Dhanteras (a celebration of renewal before Diwali), trade across the country is expected to cross Rs 1 trillion, with gold and silver alone accounting for more than Rs 600 billion, according to the Confederation of All India Traders (CAIT)." "Gold prices have jumped from around Rs 80,000 per 10 grams last year to over Rs 1,30,000 this year, an increase of about 60%. At the same time, silver has also risen sharply from 98,000 per kilogram in 2024 to Rs 1,80,000, showing a 55% increase." TOI. Finance Minister Nirmala Sitharaman and IT & Railways Minister Ashwini Vaishnaw outlined the benefits of cuts in rates of the goods and services tax (GST). While Two-wheeler sales reached 2.16 million units, "Passenger vehicle dispatches alone stood at 372,000 units in September, driven by a flurry of buying in just the last nine days of the month." ET. The new GST rates came into effect on 22 September 2025, with the number of rates cut to two rates of 5% and 18%. static.pib.gov.in. The jump in sales after 22 September was probably because, "Sales growth across products from cars to footwear has slumped to a decade low, excluding the Covid lockdown period, in the past month since the GST rate cut was announced on Independence Day (15 August), as consumers and retailers hold back purchases until the September 22 rollout." ET. Thus, the surge in spending could be due to a combination of a catch up in postponed purchases in expectation of a fall in prices and the usual festival spending. Though not the same, it is a release of pent up demand, reminiscent of 'Revenge Spending' after the shutdown during the Covid pandemic (CFI). The bulk of the sales was in precious metals probably as a hedge against the steady devaluation of the rupee against the US dollar, to a low of 88.866 on 09 October (in.investing.com), despite the valiant efforts by the Reserve Bank of India (RBI) to support the currency (ET). "India's retail inflation eased below the lower end of the RBI's 2-6% target range to 1.54% in September from 2.07% in August, driven by persistent cooling in food prices." Vegetable prices fell by 21.38% after a fall of 15.92% in the previous month. ET. The Wholesale Price Index (WPI) inflation fell to 0.13% year-on-year from 0.52% in August. ET. These figures show that prices are still rising compared to last year but not as fast. However, since inflation compounds year on year people get still less for their money. Household finances are weak. "One of India's structural determinants of sustained high and inclusive growth has been the resilience of household savings." Hence, "Declining financial savings, rising dependence on gold loans as well as overall indebtedness and a collapse of net foreign direct investment (FDI) do not portend a strong growth foundation for growth," wrote Ajit Ranade. Bank deposits have been lagging bank loans in the last two years, except for the first (April-June) quarter of this year. "When deposits grow slower than loans over a prolonged period, it could lead to liquidity and asset-liability mismatch challenges for the lender." Mint. A cash crunch leads to higher lending rates. So, is the explosion in spending due to a brilliant cut in GST? Or, is it only till the festivals are over? Will they tell us?