Current Trends in Indian Economy
RBI cuts repo rate by 0.25%
▪ The RBI reduced the repo rate by 25 basis points to 6%.
▪ India’s GDP growth forecast lowered from 6.7% to 6.5% for 2025-26.
▪ The Monetary Policy Committee (MPC) shifted stance from neutral to accommodative, signaling a focus on supporting growth.
About: Repo rate
▪ Repo rate (Repurchase Agreement Rate) is the interest rate at which commercial banks borrow money from the central bank.
▪ Higher repo rate → Costlier loans for banks → Higher interest rates for consumers & businesses → Slower borrowing & spending.
▪ Lower repo rate → Cheaper loans for banks → Lower interest rates for borrowers → Increased borrowing & spending.
