Sat Feb 08 01:57:44 UTC 2025: ## RBI Cuts Repo Rate by 0.25%, Offering Relief to Middle Class Borrowers
**Mumbai, [Date]** – The Reserve Bank of India (RBI) today announced a 0.25% reduction in the repo rate, bringing it down to 6.25%. This marks the first repo rate cut in five years and is seen as a significant boost to the Indian economy, particularly for middle-class borrowers. The decision was unanimous among the six-member Monetary Policy Committee (MPC), which maintained a ‘neutral’ stance.
RBI Governor Sanjay Malhotra cited easing food inflation, driven by the arrival of the new harvest, as a key factor in the decision. While acknowledging global economic challenges, he emphasized the strength and resilience of the Indian economy. The central bank maintained its GDP growth forecast for the current fiscal year at 6.4% and projected a growth rate of 6.7% for the next fiscal year (2025-26). Inflation is projected to be 4.8% in the current fiscal year and 4.2% in the next.
The last time the RBI cut the repo rate was in May 2020, during the COVID-19 pandemic, when it was reduced to 4%. Subsequent rate hikes, initiated in May 2022 in response to the Russia-Ukraine war, concluded in February 2023.
The RBI also announced the allocation of domain names for banking institutions, designating ‘.bank.in’ for banks and ‘.fin.in’ for non-banking financial companies.
The MPC’s next meeting is scheduled for April 7-9. The announcement follows widespread anticipation amongst economists and industry bodies, who predicted a rate cut based on positive economic indicators and easing inflation concerns.
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