RBI Cuts Repo Rate By 25bps to 5.25%, Revises GDP Growth to 7.3% from 6.8%

As expected, the Reserve Bank of India (RBI), in its second monetary policy committee (MPC) meeting for 2025, decided to cut the repo rate, the central bank's rate for short-term loans to banks, by 25bps (basis points) to 5.25% from 5.5%. Consequently, the standing deposit facility (SDF) rate under the liquidity adjustment facility (LAF) is adjusted to 5.00%, and the marginal standing facility (MSF) rate and the bank rate are set at 5.50%. RBI also revised its real gross domestic product (GDP) growth forecast for FY25-26 to 7.3% from 6.8%. RBI governor Sanjay Malhotra, who chaired the monetary policy committee (MPCC) meeting, announced the decision of the six-member panel. "The growth-inflation balance, especially the benign inflation outlook on both headline and core, continues to