The Reserve Bank of India (RBI) has announced a 25 basis point cut in the repo rate, bringing it down to 6 per cent. This move is aimed at easing borrowing costs for banks and, in turn, enabling them to offer lower interest rates to consumers, effectively reducing EMIs on loans. The decision was taken unanimously by the Monetary Policy Committee, as confirmed by RBI Governor Sanjay Malhotra.

This is the second rate cut by the RBI this year, following a reduction to 6.25 per cent in February. The repo rate, or repurchase agreement rate, is the rate at which the RBI lends to commercial banks. A lower rate encourages lending and boosts economic activity.

Governor Malhotra noted that the financial year has started amidst global uncertainties. He highlighted inflationary risks stemming from international developments, particularly after the US administration imposed reciprocal tariffs on Indian exports. “Trade tensions are dampening global growth, which in turn may impact domestic expansion,” he said, though he emphasized that the RBI is confident in managing India’s growth trajectory.

He added that India is actively engaging with the US to resolve trade disputes. While the impact of these developments on GDP is still uncertain, the central bank is closely monitoring the situation.

Despite global concerns, the Governor struck an optimistic tone on domestic indicators. The agriculture sector looks promising, manufacturing is showing signs of recovery, and urban consumption is improving, driven by increased discretionary spending. Furthermore, the financial health of banks and corporates has improved.

Due to global headwinds, the RBI has revised its GDP growth forecast for the current fiscal, trimming it by 20 basis points to 6.5 per cent. Inflation remains below the target, supported by a significant drop in food prices, which gave the central bank room to ease rates

The Reserve Bank of India (RBI) has announced a 25 basis point cut in the repo rate, bringing it down to 6 per cent. This move is aimed at easing borrowing costs for banks and, in turn, enabling them to offer lower interest rates to consumers, effectively reducing EMIs on loans. The decision was taken unanimously by the Monetary Policy Committee, as confirmed by RBI Governor Sanjay Malhotra.

This is the second rate cut by the RBI this year, following a reduction to 6.25 per cent in February. The repo rate, or repurchase agreement rate, is the rate at which the RBI lends to commercial banks. A lower rate encourages lending and boosts economic activity.

Governor Malhotra noted that the financial year has started amidst global uncertainties. He highlighted inflationary risks stemming from international developments, particularly after the US administration imposed reciprocal tariffs on Indian exports. “Trade tensions are dampening global growth, which in turn may impact domestic expansion,” he said, though he emphasized that the RBI is confident in managing India’s growth trajectory.

He added that India is actively engaging with the US to resolve trade disputes. While the impact of these developments on GDP is still uncertain, the central bank is closely monitoring the situation.

Despite global concerns, the Governor struck an optimistic tone on domestic indicators. The agriculture sector looks promising, manufacturing is showing signs of recovery, and urban consumption is improving, driven by increased discretionary spending. Furthermore, the financial health of banks and corporates has improved.

Due to global headwinds, the RBI has revised its GDP growth forecast for the current fiscal, trimming it by 20 basis points to 6.5 per cent. Inflation remains below the target, supported by a significant drop in food prices, which gave the central bank room to ease rates