RBI Cuts Repo Rate To 5.25 Percent
The Reserve Bank of India has reduced the repo rate by 25 basis points, bringing it down to 5.25 percent. The decision was taken after the Monetary Policy Committee concluded its latest review. The rate cut comes at a time when inflation has eased, giving the central bank room to support growth.
Why The Rate Was Cut
Officials said that inflation remains low and economic indicators are holding steady. With consumer prices cooling and demand recovering, the RBI decided that a small reduction would help maintain momentum. The central bank added that the rate cut is intended to support borrowing and investment, while keeping inflation within its target range.
What It Means For Borrowers
Banks are expected to adjust lending rates in the coming weeks. Home loan and personal loan borrowers may benefit from slightly cheaper EMIs. Businesses could also find it easier to access credit for expansion or working capital needs. The RBI maintained a neutral stance, signalling that future policy decisions will depend on upcoming data.
Growth And Inflation Outlook
The central bank revised its growth forecast for the current financial year, raising it based on better-than-expected performance across sectors. Inflation projections were also trimmed, reflecting stable food and fuel prices. The policy statement noted that external risks and global conditions will continue to be monitored closely.
