Wed Apr 09 07:36:41 UTC 2025: ## RBI Hints at Further Interest Rate Cuts
**Mumbai, April 9, 2025** – Reserve Bank of India (RBI) Governor Sanjay Malhotra announced a shift to an “accommodative” monetary policy stance on Wednesday, signaling a potential further reduction in key interest rates. This follows two consecutive 25 basis points rate cuts in February.
The change in stance from “neutral” suggests that the Monetary Policy Committee (MPC) is now leaning towards either maintaining the status quo or implementing another rate cut in the upcoming bi-monthly monetary policy meeting on June 6th. Governor Malhotra clarified that this accommodative stance does not directly influence liquidity management, which is handled separately by the RBI.
The February rate cut brought the repo rate down to 6.25%, the first reduction since May 2020. An accommodative stance generally implies easier monetary policy aimed at stimulating economic growth through lower interest rates, while a tightening stance involves raising rates to curb inflation. A neutral stance offers flexibility depending on economic conditions.
Governor Malhotra highlighted that system liquidity, which was in deficit in January, has improved significantly due to various RBI measures injecting approximately ₹6.9 lakh crore. As of April 7th, there is a surplus of ₹1.5 lakh crore. This improvement is reflected in softening weighted average call rates and other market indicators.
The RBI reaffirmed its commitment to maintaining sufficient system liquidity and will continue monitoring market conditions to take appropriate measures. The potential further rate cut could lead to lower EMIs for consumers.
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