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RBI MPC Meeting: In a big cheer for loan borrowers, RBI governor Sanjay Malhotra announced a more-than-expected 50 basis points repo rate cut. The repo rate now stands at 5.5%, down from 6%. RBI has cumulatively cut the repo rate by 100 basis points since its February policy review. What is a Repo Rate The Reserve Bank of India charges an interest rate when lending to commercial banks, typically against government securities. This rate is called a ‘repo rate’. RBI uses repo rate as a tool to control factors like inflation, employment, etc in the economy. Repo Rate Cuts: Recent Trends RBI MPC 2025 Repo Rate Change: The Reserve Bank of India's Monetary Policy Committee (MPC) reduced the repo rate for the third consecutive time this year, led by Governor Sanjay Malhotra. The decision, made on May 5, 2025, follows previous 25-bps cuts in February and April, driven by a decline in retail inflation to 3.16% in April, prompting banks to lower lending rates. The Reserve Bank of India (RBI) on Friday reduced the key lending rate, or repo rate, by 50 basis points, bringing it down to 5.5% from 6%. The decision was announced after the central bank’s Monetary Policy Committee (MPC), led by Governor Sanjay Malhotra, concluded its three-day meeting that began on June 4.
