The RBI’s Monetary Policy Committee (MPC) on June 6, 2025 has reduced the repo rate by 50 basis points to 5.5%.
Consequently:
- Standing Deposit Facility (SDF) rate adjusted to 5.25%
- Marginal Standing Facility (MSF) rate and Bank Rate revised to 5.75%
The rate cut is expected to lower external benchmark lending rates (EBLR), possibly leading banks to reduce lending rates.
RBI Governor Sanjay Malhotra stated that the move aligns with the CPI inflation target of 4% ±2%, while also promoting economic growth.
Inflation forecast for FY26 revised to 3.7% (earlier: 4%)
GDP growth forecast for 2025–26 is retained at 6.5%, despite concerns over geopolitical tensions and weather uncertainties.
The next MPC meeting is scheduled from August 4 to 6, 2025.
