Depositors may see lower returns on fixed deposits (FDs) following the Reserve Bank of India’s (RBI) decision to reduce the repo rate by 25 basis points to 5.25%. This is the fourth rate cut of 2025, and it signals a continued easing stance aimed at supporting economic growth while keeping inflation under control.

For investors relying on FDs for stable income, particularly senior citizens, the move is expected to prompt banks to recalibrate interest rates on new deposits.

Easing cycle and FD adjustments

The RBI’s reduction reflects room in the economy to lower borrowing costs without stoking inflation.

Saurabh Jain, Co-founder and CEO of Stable Money, noted that banks have already responded to previous cuts by reducing FD rates by 1–1.5% across popular tenures.

With the latest cut,

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